indian stock market falls on privatization rumors

The Bombay Stock Exchange (Sensex) index fell 250 points Friday on rumors related to the slowdown in disinvestment (privatization) policy, as reported here yesterday. The rumors apparently included suggestions, denied by the Government, that the Prime Minister and/or Finance Minister might resign over the issue. Separately, a U.S. trade official accused India, China, and Brazil of "hiding" behind poorer nations in order to retain unjustified protectionist policies. The official added that trade issues will be high on the agenda when the G-8 industrial nations meet in St. Petersburg later this summer. Perhaps if the G-8 included China and India, whose economies are each several times larger than that of their Russian hosts, they could address the issue more directly.