Developing Countries Hurt by Oil Spike

"Who is responsible for the global uncertainty? The sub-prime mortgage market crisis that seems to have triggered the current turbulence is solely due to poor regulations and lax supervision," he said.

"Global slowdown, rising inflation and subdued interest in investment make for a combination that can have only negative consequences for developing countries," he said. "The consequences of the crisis are being felt in India too."

To mitigate the impact of a global slowdown, India is taking steps to attract investment while spurring domestic demand the moves include reducing the income tax, expanding the corporate debt market and increasing spending on education, health and infrastructure, Chidambaram said.

"It is our intention to keep the environment for investment helpful and friendly to investors so that the investment-led India growth story continues to unfold," he said.