FM favours steps to moderate capital flows

New Delhi, Oct 26 (UNI) Finance Minister P Chidambaram today favoured steps to control capital flows without affecting investments, even though he said it was too early to assess the impact of SEBI's decision yesterday relating to tightening of Participatory Notes(PNs).

"I have said one of the concerns is very sharp increase in capital flows. Without hurting investments, we would like to take some measures to moderate the flows", Mr Chidambaram told newspersons here.

"The idea of SEBI's move on P-Notes was to moderate capital flows.

As a by-product, SEBI also achieved the objective of greater transparency", Mr Chidambaram said.

The Finance Minister, however, refused to answer questions related to further steps the Finance Ministry or RBI would take to moderate capital flows.

The market regulator had announced yesterday fresh rules to prohibit FII's and their sub-accounts from issuing new derivatives -based P Notes and required them to round off current positions in 18 months.

UNI