With the US government shutdown entering its second week on Tuesday, Democrats said they will try to convince Republicans to agree to a long-term USD 1 trillion debt-limit increase to avert the ominous prospect of an unprecedented debt default.
Abu Dhabi`s eleventh-hour bailout of neighbour Dubai will reassure investors in the short term, but with USD 35 billion of debts looming and little clarity on how it will pay, Dubai`s troubles are far from over.
Heavy rain pounded Dubai on Sunday adding to the gloom of the emirate`s debt woes a day before the deadline of the USD 3.52 billion bond by state-owned developer Nakheel, with no word on how it will be handled.
Efforts by Dubai World to restructure about USD 26 billion in debt out of the estimated USD 59 billion it owes reassured investors that the emirate`s debt problems can be contained, helping global markets edge higher on Tuesday.
Amid a pall of gloom over millions of families across India-- dependent on regular remittances from the Middle East-- after Dubai World`s repayment crisis, businessmen and analysts on the ground find the world was over-reacting.
The Prime Minister`s economic panel does not expect the Dubai debt crisis to trigger another meltdown in the world and has retained its forecast of Indian economic growth rate to 6.5 percent for the current fiscal.