The Indian investment in the US treasury bills is estimated to the tune of USD 59.1 billion.
"We (India) do not worry about that issue (US defaulting). We are not selling our US assets. We are holding on to them," Rajan told a Washington audience yesterday.
"I have to say, whatever default, will be a technical default. We do not expect the US not... From my understanding, because repayments can be prioritised, unless there is a sudden stop and markets stop taking new US debt meant to refinance the old debt there is no chance that the US will default," he said.
Rajan said it would be good for the US to adopt fiscal policies consistent with its current needs.
"The one and one and half percent of US growth would be so tremendous and welcome to the world economy," he said.