Chinese attacking the US dollar: EXIM Bank CMD

Terming the choppiness in the Indian exchange market as a temporary phenomenon, a top official on Thursday said the Chinese are attacking the US dollar to flood Yuan in international trade.

"The dominance of the US dollar is something which the Chinese are probably trying to attack. They somehow feel if yuan also internationalises and more people use it, then they can export away their inflation. That is one game, I feel the Chinese are playing," Export-Import (EXIM) Bank of India chairman and managing director Yaduvendra Mathur told media persons here on the sidelines of the FICCI Banking Conclave.

He said the Americans are able to pass on the domestic inflation to other parts of the world since the US dollar has the largest acceptability in international transactions.

Mathur noted that the Chinese have devaluated their currency to suit their own interest but contended other countries should not copy it.

"Many importers and exporters are trying to earn by currency movements - that is to be really discouraged. The currency game should not be played by any individual," he said, advising strong business houses originating from India to continue with their daily routine and not exclusively aim to gain the currency market.

"The rupee is in a very stable and very fine band and my sense is that Indian macro-economic fundamentals are strong. People should not worry - the fears are very irrational and there's too much of panic which grips us," he said.

Just before the Chinese currency's devaluation, the Exim Bank had picked up $100 million worth of yuan in the Chinese market at "attractive rates".

"It's too early to see how it (yuan devaluation) is panning out," Mathur said.

He opined that Indian manufacturers need to focus on making the products as complex as possible.

"We have to make more complex products. India should, at every stage think about how to increase the complexity," he said.