Finance Minister P Chidambaram on Wednesday said the fundamentals of the Indian economy are strong and assured the Rajya Sabha that policy rates can be revisited if inflation continues to moderate.

Replying to a discussion on supplementary demands for grants in the Rajya Sabha, finance minister said,"We have taken pre-emptive measures (to deal with the global crisis) and we are drawing upon the inherent strength of our economy.We will overcome the crisis."

Referring to the measures taken by the Reserve Bank to manage the crisis, Chidambaram said, "CRR has been reduced by 250 basis points and repo rate has been reduced by 100 basis points...We are watching the situation. If the liquidity situation remains benign, there is no reason to infuse further liquidity and if inflation continues to moderate, we can again revisit these rates."

Parliament on Wednesday approved the supplementary demands for grants with the Rajya Sabha returning the Bill. The supplementary demands were earlier approved by the Lok Sabha.

The supplementary demands envisage an additional expenditure of Rs 2,37,385 crore, which include Rs 15,000 crore for payments to banks towards farmers debt relief fund.

Referring to the capital adequacy of banks, Chidambaram said the government would recapitalise all those banks which have CRAR well above the RBI and Basel norm, but below 12 percent.

"Today I announced with the Prime Minister's permission that banks, which have capital adequacy ratio of below 12 percent but well above eight the Basel norm, well above nine percent as per the RBI stipulated norm, but below 10, I have said we will help them recapitalise those banks and bring it above 12 percent," he said.