US downgrade may hit IT industry: Pranab Mukherjee

Worried over the fallout of the US downgrade on Indian economy, Finance Minister Pranab Mukherjee on Thursday said he could make a statement on the issue in the current session of Parliament.

Stressing that there was no need to press panic button, the minister said the downgrade of sovereign ratings could have an impact on the domestic IT industry.

READ: What US rating cut means for India

"...I am worried (but) there is no need to press panic button. If required, I would like to make a statement (in the current session)," Mukherjee said while winding up the debate on the first batch of supplementary demands for grants in the Rajya Sabha.

The Upper House later returned the bills that sought to raise the government expenditure by an additional Rs 34,724 crore. The net cash outgo will be about Rs 9,016 crore, while the remaining amount will be matched by savings elsewhere.
 
The downgrade of the US sovereign rating to AA+ from AAA by Standard and Poor's has aggravated the global financial problems being faced by American and the Eurozone countries.

India too witnessed a steep fall in stock market following the downgrade on Friday evening. On the impact of downgrade, Mukherjee said, "No doubt our IT industry may be affected."
 
India's IT sector depends heavily on export to the US.
 
The government will take time to study full impact of the US downgrade on domestic industry, he said, adding the development could also have implications for exports which has been growing at an impressive pace and recorded a growth of over 81 per cent in July.