"The rupee has overshot is true level, it is undervalued ... We have to be patient, be firm, do whatever is required to be done and rupee will find its appropriate level," he told reporters here.
The Indian currency on Tuesday weakened further past 65.56 to a dollar mark in the morning trade. "Every emerging market is challenged today. India is also challenged and the impact is also felt on the equity market as well as on the currency market," he said.
The rupee has lost over 16 percent since the beginning of the year, while the equity market barometer Sensex has fallen over 8 percent or more than 1,500 points in the last one month.
Chidambaram further said the fiscal deficit would be contained at 4.8 percent of the GDP even after doling out subsidies for the implementation of the Food Security Bill.
"(Fiscal deficit of) 4.8 percent of GDP and the absolute number indicated in the Budget is a red line and the red line will not be breached ... We have provided enough money for the cost of the food security programme for the remainder of the current fiscal.
"As the roll out takes place in the states, money will be provided. We think that after providing for the Food Bill we will still remain in the limit we have set for ourselves in the Budget papers," he said.
The total food subsidy budgeted in the current fiscal is Rs 90,000 crore, of which Rs 10,000 crore is towards implementation of the Food Security Bill.
The bill will guarantee 5 kg of rice, wheat and coarse cereals per month per person at a fixed price of Rs 3, 2, 1, respectively.


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