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Last updated: 13 May, 2015  

Rupee.9.Thmb.jpg The fall of the rupee

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Bikky Khosla | 12 May, 2015

The fall of the Indian rupee in comparison to the US dollar has raised concerns. In the new financial year, the currency has fallen nearly 3 percent, initially due to a rising, strong dollar and more recently triggered by stock selling by overseas investors. Some experts fear that it may fall further in the coming days and if it happens this could kickoff a fresh bout of sell-offs in stocks, resulting in a cascading effect and laying to waste the hopes of an economic revival.

But is the rupee slump a blessing in disguise? I think it is true to some extent. First of all, the rupee is significantly overvalued and the decline will increase the competitiveness of the economy; second, the decline will help some sectors with heavy export earnings, such as IT and pharmaceutical; third, Indians working outside India will send more dollars to the country; and finally and most importantly, the weak rupee will provide some much needed relief to the export sector, which is struggling for quite some time now.

Having said this, I'm not in favor of a rupee slump, but the point is that we have to try our best to make the best of this negative development. Exports have been on downward spiral since December last year. Overseas shipments have recorded a decline of 21 percent in March, the biggest fall in the last six years. In the backdrop of this, the depreciating rupee will certainly provide the sector some temporary relief from a terrible feeling. In addition, inflation is under control and the Centre's continued effort to push reforms will prevent the rupee crash once again as it did last year.

Meanwhile, there was a huge ruckus in the Parliament on Monday. The Land Bill was introduced in the Lok Sabha, but the members of the Congress party and some other parties staged a walkout. It has also been reported that the Congress is working on multiple strategies to prevent the Goods and Services Bill from being passed in the Rajya Sabha. If the decision is based on their genuine desire to scrutinize the amended bill, they cannot be blamed anyway, but if they do it only to undo the BJP, the public at large will not have any sympathy for such a move.

I invite your feedback.

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Currency & Daily Life
Vikram | Sat May 16 07:33:23 2015
Fall of rupees is highly temporary and it is the dirty play of some exporters primarily and malpractice of certain politrics people which is neither ours nor others hands except few goons. This is a global phenomina which is not possible to control like certain business like Oil, Precious Metal etc India & China together confirmed Rail car at Dubai and china started R&D and developed 460 km speed car where still we are begging to others that when you are ready to supply us including China which is shameful in all means of life. Including our top business tycoon tata or DRDO or Railway have no professional R&D at all. Our PM's have no R&D related to what he preaches and no mechanism or available machinery is totally rotten or rusted and useless even oiling with due maintenance. Need fresh blood below the age of 50 years to rule our Country for next few years and all the 50 to 60 may be in the Ministry and 60 to 70 may be included in the Advisory Board or at Niti Ayog to monitor and supervise with permission to take corrective steps If our Country required or needed to attain best level of international standard. Back to Currency: Our RBI Head declared once 2005 and before notes of 500 & 1000 will be recalled. If the same implemented then See the difference of Nations Development 99% black money will be abolished but we are blabbering about black money abroad which we have no access nor discretion to touch except putting chilly on publics eye and wasting public money as well

Fall of the rupee
VT Vijayaraaghavan | Wed May 13 11:37:59 2015
Indian economy is highly dependent on Imports. The rupee has to be strengthened for the benefit of the economy.

The fall of the rupee
Francis P.V. | Wed May 13 11:10:37 2015
The fall of rupee value will effect on the common man life, due to the price hike on consumer goods and grocery, is it not necessary to take steps to stop the fall.

Reagarding fall of INR in international market
Girjesh Kumr Pandey | Wed May 13 11:08:09 2015
I agree with your suggestions strictly. I support Modi govt. Policies that can make shine India in future and the future of Indian young generation. Indian currency will grow up in coming next few years.

Rupee falling
Satish | Wed May 13 08:38:41 2015
Its highly discouraging for any Industry. This would naturally de morale exporters / importers doing their regular business as whole some. We are waiting for best days since long time. Hope things to settle down on its own. Since no ane can understand this Science properly. 1 dollar @ INR 64 plus its horrible to digest. Hope best to come soon.

Land bill
JAGMAL SINGH | Wed May 13 08:03:19 2015
Dear sir, I am not expert but I feel LAND BILL is not required because first government shall restart the closed companies.for example in GOA about 70% companies are closed and my question is why government want new agriculture land for factories. we have more than crores factories which are closed and space are not utilized for any work.WHY government can not re-allot such closed factory to new needed person. I know no body will look for this type of suggestion. REGARDS, JAGMAL SINGH

fall of rupee
srivathsan | Wed May 13 05:29:13 2015
The article is quite informative. I would to share my thoughts on this subject. The simplistic thinking is that export must increase and imports must reduce.reduce. Uner the reduction of imports I would suggest that import of fertilizers must be given a second thought since most of the items can be reworked in India either through organic manure route or through recovery from sera water. The next import bill is on fuel which can be reduced by generating Bio methane gas as much as possible and find methods to make bio fuel including bio ethanol to a get extent. Thirdly Gold monetiesation should increase and an incentive of 8% must be given for gold deposits instead of just 3%. The monetarily value received shall be only in the form of E money and cannot be converted to cash in the banking channel or other legalized channels.The money will not be used for black money transaction

Land Bill and GST
Anil Kumar Verma | Wed May 13 04:17:19 2015
The Congress Govt lost the elections because of Policy paralysis caused by a agitating and obstructive opposition who were voted to power.Now if the Congress does the same why will the Public not have sympathy for them ?Concerns and issues are the same.

Fall of Rupee
Gopinathen Pillai | Wed May 13 03:40:22 2015
Quite true. But don't you feel the FIIs in the stock market are not responsible for the current fall? I personally feel they the FIIs should be slowly phased out from India. We don't need them to play in the stock market. Once they are phased out, the recurring fall in rupee value can be curtailed to some extent. Gopinathen Pillai

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