Greece crisis to create some uncertainty in fin markets: Montek

“I don’t think in medium term it is going to make any difference to India. When I talk about medium term … I mean three to four months,” he said,adding “the short term movement in stock markets should worry up too much.”

Greece is facing financial crisis and the likelihood of default on sovereign loans of over USD 50 billion has prompted the Standard and Poor’s to downgrade country’s credit rating to junk grade. The crisis seems to be spilling over to other European countries like Spain and Portugal.

Ahluwalia said,”The weaknesses that are showing up in the European countries are reflection of very high fiscal deficit and debt level … and very low growth.”

“They have a fiscal deficit,we have a fiscal deficit but the difference is that there debt level is higher than ours. I dont think that the short term movement in stock markets should worry up too much”,he said.

“If there is downgrading of debt in a particular country then essentially there a flow of capital away from the downgraded debt to other markets … money is moving out from somewhere has to go somewhere,” he pointed out.