CPI, JD-U target UPA as rupee tumbles to all-time low of 68.75 against dollar

Expressing concern over the economic crisis in the country, Communist Party of India-Marxist (CPI-M) leader Sitaram Yechury on Wednesday said the government should stop giving tax concessions to the country's rich and push them to invest in the economy.

"The government now, like in 1991, talks of more reforms. Reforms are what brought this situation, what is required is stop these incentives for the rich. You are giving these incentives of more than five lakh crores annually in terms of tax concessions saying that it is required stimulus for investment, what has it led to?" asked Yechury.

"Your index of industrial production today is -1.6. So, all these incentives are doing what, they are putting money in the hands of the corporates and rich, who are instead of investing them are parking them in these three avenues, gold, real estate and foreign exchange," he added.

Meanwhile, Janata Dal (United) chief Sharad Yadav said this economic slump was hurting everyone in the country.

"The whole country understands the falling state of the economy, whether it is the farmers, labourers, traders, industrialists or corporates, all of them are understanding that the market and the country's economy has stopped growing, it is in terrible condition," he said.

The rupee plunged to a new record low of 68.75 per dollar in the late morning trade on persistent dollar demand from banks and importers due to further fall in equity market amid rise in crude oil prices.

The SandP BSE benchmark Sensex plunges further by 473 points in the late morning trade on persistent selling pressure, triggered by sharp fall in the rupee value against the dollar coupled with sustained capital outflows by foreign funds.

Continuing its rising streak, gold prices climbed to cross Rs 34,500 per 10 gram level for the first time ever in futures trade today as rupee tumbled to hit an all-time low of Rs 68.75 amid a firming trend overseas.

The Finance Minister had earlier on Tuesday suggested a 10-point formula to revive the country's economic situation, and sought co-operation from all quarters despite ideological and political differences.

Chidambaram, who was replying to a discussion on the country's economic situation in the Lok Sabha, said the country needs more reforms, lesser restrictions and an open economy.

The Finance Minister 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.

He said the government is doing everything to boost investment.

Chidambaram emphasized that no stone will be unturned to reap benefits of good monsoon.

"We should reap benefit of a good monsoon. Nothing must be done that would come in way of maximising agriculture production," he said.

The Finance Minister also underlined the need to encourage manufacturing in sectors like power, steel, automobiles and textiles.

"We must increase production of electronics and textiles. We are importing things which we should not have imported. India can be strong only if we have a strong manufacturing economy," he said.