Can we save the Drowning Rupee?

29 August 1947 1/dollar.

29 August 2012 55/dollar.

29 August 2013 69/dollar.

What a contrast it is, at one time we were having 1/dollar exchange rate and today we are having 69/dollar. Though it was not possible for India to maintain such an exchange rate (as it would decrease its competitiveness in the market and would not be able to grow) but India has let the rupee drown in the ocean. If strict measures are not taken by the economy then we will surely lose the control.

But the big question is whether we can really help the rupee from letting it lose its value. The answer is yes, surely we can up to an extent if not fully. Though the great people of our country Dr.Manmohan Singh and Chidambaram are taking various measures which will show there effect in time ahead but still there are various measures which if followed can help the economy to overcome the crisis in India.

Some of them as given by the various Economists of our country are:

1. If we buy oil from Iran we can actually save $10 billion in foreign exchange outgo. It’s because Iran is giving us oil in our domestic currency so it will surely help us in lowering our CAD and will also save a huge amount of foreign exchange which can be used for other imports.

2. Right now we are importing huge iron ores and coal to meet our demand even when we have huge reserves of both in India. Yes, due to orders of the Supreme Court, mining of both has been banned in Karnataka and recently in Goa and Odisha. The government can easily generate $20 billion or one per cent of GDP by allowing higher coal and iron ore production from its large reserves.

Well these are various other measures which if followed can drive the rupee back on track and will also boost the economy.

It’s not that our currency or country is the only which is facing the crises in the world but there are various countries like Malaysia, Brazil, South Africa, Turkey, Indonesia which are also facing the same conditions like India. It’s solely not due to the policies followed by our government in the last few years but also due to the Syria problem and the slowdown in the world economy.

Pray that Manmohan comes out of his oyster and wave his magic wand.