Responding to the stock market fall today, the government advised investors to take "informed and responsible decisions in the situation and not be led by rumours or any unwarranted apprehensions."
"The fundamentals in the domestic economy are quite strong. Today’s market fall reflects the continuing uncertainties in the global economy and not any change in the fundamentals of the Indian economy," a release issued by the finance ministry said.
Prime Minister Singh said sustained market growth "is our high priority."
He added that fluctuations are due to market forces.
The Bombay Stock Exchange’s Sensex dropped 1408.35 points (7.41%) and the NSE Nifty declined 496.5 points (8.7%) today.
"Most of Asia opened the year 2008 on a weak note with heavy selling pressure seen in most markets. Comparing the major Asian market indices as on January 2, 2008 with their closing today, it is seen that the Straits Times has fallen 14.75%, Hang Sang 13.58% and Nikkei 9.29%. The corresponding figure for the Sensex is 13.97%," the release said.
As regards domestic economic conditions, the just released review of the economy 2007-08 by the Economic Advisory Council of the Prime Minister has estimated the rate of growth of GDP in 2007-08 at 8.9%.
"Corporate profits, as reflected in the third quarter 2007-08 results, continue to be buoyant. Direct tax revenues have shown an increase of 42.8% between April and December. Banks have reported that investments in the pipeline are robust and credit demand is high," the release added.
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