After sub prime crisis in the US , this year a similar realty bubble busted in Dubai. This emirate had witnessed a realty boom in 2007 and 2008. The Dubai world, the government arm of construction industry, had borrowed heavily it seems more than its GDP, but the the property prices had fallen after the global meltdown , thereby unable to repay the debts on time as a result, it had asked for an extension of repayment period or for re-negotiating the repayment terms.
This news was enough for the sock markets to nosedive. Initally, it was Dow Jones and it later it spread it to Asian Markets to tumble . In India, the stock markets had felt the jitters which was sweeping across the financial makets of the world.
The only concern for India was a dip in the remittance from this region. As the news broke out many instituitions came out with a statement stating their exposure in Dubai. India Inc exposure is minimum. However, RBI had asked all banks to estimate its exposure to this mess and present a statement to it.Moreover, it had asked for a study of its impact on the Indian Economy.
