Korea’s financial authorities are considering drawing up contingency plans to cope with the negative impact of a possible financial crisis in emerging Asian countries, industry sources said on Wednesday.

The move by the financial policymakers comes after news that India, Indonesia and Thailand have recently undergone a drop in their currency value and equity prices, which were reportedly affected by the U.S. exit strategy to retrieve its investment in emerging countries.

The policymakers also appeared to be concerned over the possibility that foreign investors may dump Korean stocks in the coming weeks or months due to the possible crisis and over reports of how the Fed pulling back from quantitative easing may affect the Korean markets.

On Wednesday, foreigners net sold 144.4 billion won ($125.5 million) on the Korea Exchange, which pulled down the Korea Composite Stock Price Index to 1,867.46. It marked a 20.39 point drop from the previous day’s trading.

“Although the possible crisis in India and Indonesia is likely to have minimal effect on Korea, we are bolstering the monitoring of financial indices as the Korean economy had sometimes been volatile to external factors,” said an official of the Financial Services Commission.

The Finance Ministry and the Financial Supervisory Service are also set to take preemptive measures against the potential crisis despite officials downplaying the possibility that foreigners could pull out from the nation’s stock market that is now considered one of the more stable in the world.

Over the coming weeks, the financial regulator FSS plans to hold a series of emergency meeting of senior officials to closely monitor investors’ movement on the stock and foreign exchange markets.

In a statement later in the day, the Finance Ministry said Korea was showing stability in terms of funds’ in-and-out for foreign exchanges, stock trading and the level of CDS premium, a barometer for sovereign risk.

The ministry also compared the foreign exchange reserves worth $330 billion held by South Korea with Indonesia with $113 billion, Thailand with $182 billion and India with $260 billion.

It also cited research reports from global investment banks including Goldman Sachs, which predicted that the Korean currency would not be sharply depreciated versus the U.S. dollar.

A Bank of Korea official said financial authorities could minimize volatility in major financial indices by carrying out preemptive actions, citing past cases such as North Korea’s threat and the eurozone debt crisis.

By Kim Yon-se (kys@heraldcorp.com)