India curbs outward investment to help rupee India has unveiled new limits on outward investment by companies and individuals in its latest move to bolster the rupee, while Manmohan Singh, prime minister, has promised a return to high economic growth after a sharp slowdown in the past two years. The Reserve Bank of India cut the maximum outward direct investment allowed for future deals to a quarter of the old level, reducing it to 100 per cent of the net worth of the Indian investor from 400 per cent unless special permission is granted. State oil companies are excluded from the new restrictions. Citing "the current macroeconomic situation" and a desire to curb financial outflows, the central bank also tightened restrictions on Indian residents seeking to send money abroad, particularly to buy property. A slowdown in Indian economic growth and frustration among business leaders with the country's tax regime and bureaucracy have not only deterred foreign investors from coming to India but also prompted large Indian companies to invest abroad in sectors from the motor industry to consumer goods. Morgan Stanley concluded that the latest measures would probably make "a small difference" to the balance of payments in the near term, with outward direct investment perhaps falling by half from the $7.1bn over the latest four quarters. "While the authorities aim to reduce "FX volatility," we fear that they may end up sending a panic signal," said Sonal Varma, economist at Nomura. India's government, faced with a declining rupee amid concerns about the current account deficit and annual growth that has fallen below 5 per cent, has taken a series of steps to try to strengthen the currency. They include repeated increases in the import duty on gold - now 10 per cent - and threats of higher duties on "non-essential" goods. On Monday, Palaniappan Chidambaram, finance minister, pledged to cut the current account deficit to 3.7 per cent of gross domestic product this financial year from 4.8 per cent in the year to March, and to help finance it by allowing more foreign borrowings by India-based companies. Mr Singh, in a speech to the nation from the walls of Delhi's Red Fort to mark the 66th anniversary of Indian independence, said his government was trying to "remedy" the problem of slow growth. "I believe that this phase of slow growth in India will not last long," he said. In the last nine years, our economy has grown at an annual average rate of 7.9 per cent. This pace of development is the highest in any decade so far. He added: "Rapid economic growth is an imperative for our country. Without it, we cannot possibly achieve targets such as removal of poverty, provision of good quality education and health services and creation of new employment opportunities. The independence day speech by the 80-year-old Mr Singh was his last before a general election due by May next year. In power since 2004 at the head of coalition governments, the Congress party led by Sonia Gandhi has been fiercely criticised by investors for the widespread corruption on its watch and for the slow pace of economic reform. Mr Singh promised to push ahead with big infrastructure projects and to accelerate bureaucratic procedures for investments. Narendra Modi, chief minister of Gujarat and the man expected to lead the Hindu nationalist opposition Bharatiya Janata party into the election, called Mr Singh's speech disappointing and mocked the Gandhi family that controls the Congress party. In a his own speech in Gujarat, Mr Modi said India was "in a deep pit" and needed the kind of good governance and economic development seen in his state. His supporters compared his characteristically colourful and energetic rhetoric with Mr Singh's halting, soft-spoken performance in Delhi.