Our fiscal parameters have not been too different from some of the countries that have experienced the most turbulence, such as Turkey and Argentina. In fact, it is because of our inadequate fiscal performance that India did not have investment grade rating until earlier this year.
The main reasons why India has been able to maintain financial stability in the presence of such fiscal stress is that almost all the sovereign debt has been domestic, except for bilateral and multilateral external borrowing, which itself has been small proportionately. India has eschewed sovereign borrowing in external markets, thereby insulating ourselves from external volatility in exchange rates and interest rates.