The country's bloated fiscal deficit has been a key concern for Asia's third-largest economy -- currently undergoing its worst slowdown in a decade -- and has triggered the threat of a sovereign credit rating downgrade by global ratings agencies.

The panel also said that the Reserve Bank of India (RBI) must maintain its current monetary stance until the rupee stabilizes. India's currency dropped to record lows against the US dollar in August.

The panel said that net foreign direct investment (FDI) flows would likely be at USD 21.7 billion for the current fiscal year, down from an earlier estimate of USD 24 billion.


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