Ukraine-Russia tension: Crude oil pose challenge to India's financial stability, says FM

Union Finance Minister Nirmala Sitharaman said on Tuesday rising crude oil prices amid escalating UkraineRussia tensions pose threat to Indias financial stability and the government is closely monitoring the situationTalking to media persons after the Financial Stability and Development Council FSDC meeting here Sitharaman said the situation is worrisome and India has called for a diplomatic solution to the UkraineRussia crisisOn the challenges posed by the rise in crude oil prices to the Indian economy the Finance Minister said It is difficult to say how it will go Even today in the FSDC when we were looking at the challenges which are posed for the financial stability crude was one of the thingsCrude oil prices surged close to 100 per barrel in the international markets on Tuesday after tensions between Russia and the United States and major European countries over the Ukraine issue escalatedThe United States and its European allies are set to impose new sanctions on Russia after President Vladimir Putin formally recognised two breakaway regions in eastern Ukraine Russia has also troops in the breakaway regions The move is likely to further escalate the tensions in the regionAsked about the Government of Indias plan to deal with the economic challenges posed due to the growing UkraineRussia tensions Sitharaman said we are keeping a watchThe Finance Minister earlier chaired the 25th meeting of the Financial Stability and Development Council FSDC The Council noted the need for a constant vigil on financial conditions and the functioning of financial institutions in the countryThe Council deliberated on the various mandates of the FSDC and major macrofinancial challenges arising in view of global and domestic developments Finance Ministry said in a statementThe Council noted that the Government and all regulators need to maintain a constant vigil on the financial conditions and functioning of important financial institutions especially considering that it could expose financial vulnerabilities in the medium and longterm it saidThe Council also discussed measures required for further development of the financial sector and to achieve an inclusive economic growth with macroeconomic stabilityNirmala Sitharaman is on a twoday postBudget outreach visit to Mumbai where she is meeting with representatives of industry financial market functionaries and bankers the Finance Ministry saidThe Council chaired by the Finance Minister also discussed operational issues relating to currency management It also took note of the activities undertaken by the FSDC SubCommittee chaired by the RBI Governor and the action taken by members on the past decisions of FSDCThe Financial Stability and Development Council has been set up by the government in consultation with financial market regulators to strengthen and institutionalise the mechanism for maintaining financial stability enhance interregulatory coordination and promote financial sector developmentWithout prejudice to the autonomy of regulators the Council monitors macroprudential supervision of the economy including the functioning of large financial conglomerates and addresses interregulatory coordination and financial sector development issues It also focuses on financial literacy and financial inclusionThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever