Capital inflows not a concern for now: RBI

He said the inflows were roughly in line with India8217;s current account deficit. 8220;We cannot call it a capital surge like what happened in 2006-08,8221; he said.

An economic adviser to the prime minister has said India could absorb inflows of up to 100 billion in the current fiscal year,well above his expectations of inflows worth 57-60 billion.

The Reserve Bank of India had said on Wednesday it would withdraw from Jan. 1 some concessions on external commercial borrowings ECBs for Indian firms introduced during the global credit crisis,although it also eased rules for the infrastructure and telecoms sectors.

8220;Yesterday we reversed the easing we had done on the ECB policy,8221; Subbarao said. 8220;That8217;s our policy for now. I cannot really speculate on what,if any,we will do,8221; he said.

PRE-CRISIS NORMS

The limits on overseas borrowings were relaxed during the global financial crisis as Indian companies were not able to raise ECBs at the spread the central bank prescribed,Deputy Governor Shyamala Gopinath said.

8220;We simply reverted to the spreads that existed prior to the dispensation. This is a part of capital account management framework. It does not indicate any capital control,8221; she said,adding the markets have now normalised.

Subbarao,who is in Kolkata for a central bank board meeting,declined to comment on any further moves on capital account management and said the bank was monitoring the liquidity situation.

8220;If there is too much liquidity it has a potential for asset price buildup. But every asset price buildup need not necessarily result in asset price bubbles and we are keeping a vigil on that,8221; he said.

On Monday,Subbarao had said capital inflows reflected investor confidence in the economy.