'India's economy, banking system sound'

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WASHINGTON, Oct 11 (Reuters): The Indian economy and banking system are sound, the Reserve Bank of India (RBI) chief assured the world financial community Friday, as a global credit crunch intensified and world stock markets tumbled.
"What we are witnessing today in the Indian markets is an indirect, knock-on effect of the global financial situation," RBI Governor Duvvuri Subbarao told a news conference. "We are monitoring the situation on a continuous basis and stand ready to take appropriate effective and swift action."
He said managing inflation, while maintaining growth momentum and financial stability were the immediate short-term priorities of the Indian central bank.