I have been seeing this type of columns in Rediff since last 8-9 months... columns against the Rising rupee and presenting the wrong picture, creating havoc among the Indians. Let me tell you that it is not Rupee which is rising, but the value of Dollar is falling and it is falling against all the major currencies of the world and when you compare Rupee with other currencies like Pound, Euro etc there is no rise as such... so to say that US will try to find some other place for outsourcing or the jobs will go away to some other place is not at all correct... I would request rediff to stop this nonsense, it is a fact that US has no other option because of the advantage India has of the english speaking population....
RE:Rising Rupee
by Anuroopa Yedire on Jul 28, 2007 12:13 PM Permalink
Vishal, I agree with you that dollar is loosing value, but if you compare the rupee with euro and pound in last 6 months, rupee has appreciated quite well. I went to Germany 6 months back and euro that time was ~58, now it is around 55, pound was 88 and now it is 80....so rupee is defenitely appreciating.
Stop projecting India as a cheap alternative. Instead make quality product and sell at premium. IT companies have ruined the country's image. If they hv to become global companies then they hv to take orders inspite of the rising Re. Nobody is interested in devaluation of the Rupee just b'coz these exporters need cheap labour. So stop cribbing and move ahead with an appreciating Rupee
RE:Exporters shud focus on quality
by Parin Makadia on Jul 29, 2007 04:01 PM Permalink
Hi Kaza, I highly appreciate your statement. Example - It is quaility which has made Europe net exporter of goods/services inspite of strong Euro........Parin (speak2parin@yahoo.co.in)
RE:Exporters shud focus on quality
by Loan Shark on Jul 29, 2007 06:40 PM Permalink
well, if an indian company refuses to work on a project because they aren't making enough, their are others waiting to grab the business.
It's a competitive world, and IT margins are still very high and so are Indian salaries compared to other trades.
In US they wanted to cut cost, they brought programmers from India. Then they began outsourcing. Now they will ask for cuts in bill rates as they know that competition is fierce.
then only it can be said that INDIA is growing.nowadays everything Whatever they product or make agriculter,software,any product that is for export in order to get most of the money not for its own counter if then rupee value rise then producer are less interesten for export as a result then can implement those product in india and that again would increase the groth of india. i have seen many professional who want to work only for the developed nation though they belong to india because india cannot provide the basic facilities like the electricity,quality drinking water.various type of crops that are product in india are seprated as good and bad quality the good is for export for making much money and the bad is for india itself. the reason why good quality is for export because of the high currency value of developed nation and developed national implemented quality standard if the product is up to the quality then only they purchase. one last sentence i want to say is that the Govt should not continew with the disinvestment instead of privatisation Govt should handle everything by its own. think of it "what a Govt cannot do is doing by the private organisation" if Govt would do everything by its own then only the country is survive "nahi to jaise chal raha hai waise chalne do mast raho and do not compare with anyone warna kaha jayega rassi jal gai par bal nahi gay" its true
RE:Rupee Value Should Increase
by Milind on Jul 27, 2007 07:40 PM Permalink
I urge you to improve your written English. Maybe you are writing in a hurry. It is very difficult to read your posting. I hope you take this in a positive manner. Thanks.
Look at the plight of vast majority of expatriate Indians working in the Middle East. Our meagre salaries were just not sufficient and were not able to keep pace with rising cost of living in India. Coupled with the effect of rising rupee, we are just left with no hope for future. Miserable days are ahead.
RE:It is really making us very poor!
by second timer! on Jul 29, 2007 04:03 PM Permalink
Hey Arun, Think of it this way - for years you and your fellow ME/Gulf workers have enjoyed a fantastic lifestyle while we back home have had to work our butts off. Now its out turn to enjoy that same lifestyle. So while I feel sorry for you, I do not sympathise at all. If its really that bad for you, get your act together - prove you arent just mediocre second raters and come compete with us on Indian soil. Sincerely, Rahul
RE:It is really making us very poor!
by vikas nahata on Jul 29, 2007 08:14 PM Permalink
Rahul, U r talkin too big...u dont understand one fact, if the jobs move bak 2 the countries where it came from then wat u ll do...so dont act oversmart by rising rupee...u r lookin at govt's flaw as correct as they r not able to stop anythin as inflation, re appreciation etc... u ve to pay eventually and wud b in deep trouble if this things keep on happening...so dont feel jealous but try to think whoever is outside india he or she is also working too hard to earn his or her living....its not a bed of roses as it seems...
RE:It is really making us very poor!
by Ananthapadmanabhan on Jul 29, 2007 02:46 PM Permalink
Why do you want to worry, if Re. Appreciates? You just calculate your saving potential per month. How much you can able to save, that is more important rather than looking at macro economic factors.
Rupee is rising only because of Market dynamics.
Currency fluctuations are common in the modern economy.
Exchange values have multiple implications and depends on who you are. If you are a businessman importing raw materials (mostly from other developing countries) and manufacturing finished products and doing business within India catering to domestic consumption or exporting to dollar economies, then a rising rupee is good. Why ,because you can pass on the benefit of higher purchasing power of the rupee to the consumer since the input cost in terms of cheap imports of raw materials, cheap oil, transport cost,imported machinery cost etc, will be lower as you will get more dollars per rupee and retail price reduction is possible. Then more and more people who were previously out of your customer bracket will now come into your fold and buy your products realizing huge volume in sales. Technology imports and upgradation will also be cheaper since you will pay less in dollar terms if the rupee appreciates. These industries are Commercial aviation, professional services like health care,education,etc. Other Infrastructure creating industries like road building ,power generation, essential utilities like water resource management , surface transport etc will also benefit from rising rupee because our rupee will buy more cement, steel, bitumen etc etc, either locally or through cheap imports if the rupee is strong. If you are a importer of finished products and catering to domestic consumption without any value addition, rising rupee is good news again since it allows you to pu
Exchange values have multiple implications and depends on who you are. If you are a businessman importing raw materials (mostly from other developing countries) and manufacturing finished products and doing business within India catering to domestic consumption or exporting to dollar economies, then a rising rupee is good. Why ,because you can pass on the benefit of higher purchasing power of the rupee to the consumer since the input cost in terms of cheap imports of raw materials, cheap oil, transport cost,imported machinery cost etc, will be lower as you will get more dollars per rupee and retail price reduction is possible. Then more and more people who were previously out of your customer bracket will now come into your fold and buy your products realizing huge volume in sales. Technology imports and upgradation will also be cheaper since you will pay less in dollar terms if the rupee appreciates. These industries are Commercial aviation, professional services like health care,education,etc. Other Infrastructure creating industries like road building ,power generation, essential utilities like water resource management , surface transport etc will also benefit from rising rupee because our rupee will buy more cement, steel, bitumen etc etc, either locally or through cheap imports if the rupee is strong. If you are a importer of finished products and catering to domestic consumption without any value addition, rising rupee is good news again since it allows you to pu
Rupee appreciation will help Indian domestic companies aquire asset overseas at about 10% lower cost.It will make the imports cheaper(we import more than export)and play a positive role in making export oriented unit more efficient.No exporter needs to die .Necessity will push them to change their mindset to quote in Indian rupees and alternative currencies. It will be a temporary set back but largely the economy will be benifited.
RE:rupee appreciation
by Girish Kakar on Jul 26, 2007 04:38 PM Permalink
haha.....do u hav any idea how big is the US market.....n if india loses its market in US due to high value of rupee how much will india lose???.....for ur kind info,US is the larget importer in the world......india has a growing manufaturing sector n once profuction exceeds local demand exports come to rescue.....n losing US will be a big set back for the growth of the indian eco....if u r made the FM the,i fear ur "temporary set back" from becoming a "permanent set back"
RE:rupee appreciation
by saravana kodandapani on Jul 26, 2007 08:11 PM Permalink
Exchange values have multiple implications and depends on who you are. If you are a businessman importing raw materials (mostly from other developing countries) and manufacturing finished products and doing business within India catering to domestic consumption or exporting to dollar economies, then a rising rupee is good. Why ,because you can pass on the benefit of higher purchasing power of the rupee to the consumer since the input cost in terms of cheap imports of raw materials, cheap oil, transport cost,imported machinery cost etc, will be lower as you will get more dollars per rupee and retail price reduction is possible. Then more and more people who were previously out of your customer bracket will now come into your fold and buy your products realizing huge volume in sales. Technology imports and upgradation will also be cheaper since you will pay less in dollar terms if the rupee appreciates. These industries are Commercial aviation, professional services like health care,education,etc. Other Infrastructure creating industries like road building ,power generation, essential utilities like water resource management , surface transport etc will also benefit from rising rupee because our rupee will buy more cement, steel, bitumen etc etc, either locally or through cheap imports if the rupee is strong. If you are a importer of finished products and catering to domestic consumption without any value addition, rising rupee is good news again since it allows you to pu
RE:rupee appreciation
by saravana kodandapani on Jul 26, 2007 08:18 PM Permalink
If you are a importer of finished products and catering to domestic consumption without any value addition, rising rupee is good news again since it allows you to purchase more units of the same product and the cost per unit comes down and high volume sales of imported items in thedomestic market is then possible. If you are a exporter of raw material without any value addition, then a rising rupee is bad news since your client will be forced to pay more dollars for your product and this will force him to look at other sources of cheap raw material since cost is the only factor that determines his purchasing behaviour as there is no value addition. If you are an exporter of finished ethnic products like bangles, bindis,lehengas,jewellery etc, rupee appreciation has little relevance since the profit margins in these items are very high and the clients will be looking for purchasing from you only since other countries cannot compete with your ethnic items. If you are exporting high value finished products like cars ,electronic items etc which as such is not very much in India, then the product commands the price in the market and still you do not have to worry about rupee appreciation. This is the reason why countries like Japan, America , Europe have strong currencies because the govt has a job to do in the form of running the country by providing good roads, infrastructure,Continuous Electricity, Water, etc etc to its citizens, who inturn repay the govt in the form of ta
RE:RE:rupee appreciation
by saravana kodandapani on Jul 26, 2007 08:20 PM Permalink
This is the reason why countries like Japan, America , Europe have strong currencies because the govt has a job to do in the form of running the country by providing good roads, infrastructure,Continuous Electricity, Water, etc etc to its citizens, who inturn repay the govt in the form of taxes by generating revenue by excelling in their professional abilities and creating a demand for their services and products not just locally but all over the globe. That is why you have Japanese,American,French,and British majors exporting high end products like Electronic gadgets, High end cars, passenger jets, Missile warfare systems, Nuclear submarines etc and not clothes, peanuts, bananas . Indian Exporters on the other hand want to export items on the lower end of the value chain like raw materials, textiles,Food items, body shopping etc because these do not require R&D, can be prepared with low wages, High end technology is usually not necessary and Profit margins are huge in dollar terms if they can ensure that the rupee is always weak. In this way,over a period of time ,undereducated, semiskilled or unskilled workforce will find employment in one form or the other and this kind of manual labour driven employment generation and manpower oriented industries thrive under these guidelines, but the general quality of life will be poor since the industrialists and beaurocrats ensure that the profits generated in dollar terms does not trickle down to the labourer who is satisfied wit
RE:rupee appreciation
by saravana kodandapani on Jul 26, 2007 08:31 PM Permalink
To elevate this entire billion to the higher end of the value chain white collared employment, requires huge investments in basic healthcare, primary secondary and tertiary education, infrastructure for roads,electricity, river water sharing, ecological conservation,High end R&D labs in niche segments, etc for which it requires a strong rupee,but in its pursuit of a strong rupee, it runs the risk of making entire lower end sectors unprofitable and the millions associated with these sectors will go hungry like what is happening with farmers, tea sector workers today.Even in America Workers at the lower end of the value chain getting laid off due to rising dollar is a problem but the govt is able to manage since their numbers are not huge like in India, and there is a social security system in place. The only solution our govt has is to turn protectionist with a rising rupee where cheap imports of products like agricultural produce, raw materials, are prohibited, atleast the domestic market is guaranteed with a minimum purchase price that can sustain life in these industries and subsidies are given along with a tax holiday to make it lucrative for private players as well as foreign investors to invest in rural employment generation. This then goes against the principles of free market economy and the other section of exporters feel the ripple effect when other countries turn protectionist. While the magnitude of our population makes low value,low end job creation a priority
RE:rupee appreciation
by Confused on Jul 30, 2007 01:59 AM Permalink
Dear Saravana Kondapani, Please post the summery of your comments in 5 lines. thank you, Saddam Hussein
RE:RE:RE:rupee appreciation
by saravana kodandapani on Jul 26, 2007 08:23 PM Permalink
the general quality of life will be poor since the industrialists and beaurocrats ensure that the profits generated in dollar terms does not trickle down to the labourer who is satisfied with a hand to mouth existence for which he is evergrateful and the huge chunk of profits cornered by Agricultural ,Pharmaceutical,Manufacturing exporters which when combined with tax evasion increases the divide between the rich and the poor.The govts cannot meet the aspirations of providing the basic amenities to its citizens coupled with a weak rupee. The govt depends on these employed people and industrialists to generate good profits, pay good taxes and fill the coffers of the govt for it to spend. However this does not happen because of tax evasion, underwriting, low wages to the extent that the govt gets peanuts in return for the artificially weak rupee that it has created and the rich get richer and the rich-poor divide becomes larger.. The govt is faced with a unique situation here, it has a billion mouths to feed, a billion pairs of hands willing to work and a billion minds always comparing the services and quality of life available with what is available in the west. To elevate this entire billion to the higher end of the value chain white collared employment, requires huge investments in basic healthcare, primary secondary and tertiary education, infrastructure for roads,electricity, river water sharing, ecological conservation,High end R&D labs in niche segments, etc
RE:RE:RE:rupee appreciation
by saravana kodandapani on Jul 26, 2007 08:32 PM Permalink
While the magnitude of our population makes low value,low end job creation a priority for the govt, it is beneficial to the semieducated and semiskilled labour force to have some job instead of putting their brains to work and start an enterprise by themselves. Our country does not encourage high value and cutting edge technology entrepreunership if we make cut off ourselves with high end technology due to the cost of a astronomical dollar. There is no point in discovering the wheel all over again. Allowing the rupee to stabilize at its true value, cutting the inflation dramatically, and converting our economy to a high value economy should be our long term objectives while in the short term , subsidy, minimum price guarantee, tax benefits and domestic market protection can offset a major portion of the losses incurred. This is the price we pay to lift and ignite a billion minds on our way to becoming a superpower.
RE:rupee appreciation
by shashidhar biradar on Jul 27, 2007 11:14 AM Permalink
Girsih sir, US economy is 25 trillion $ and Indian economy is 1 trillion $
Indian economy highest employment generator in the world, generated more than 11.3 million new jobs Rapid growth may lead to manpower crunch: HIGH- SUSTAINED growth in India is generating huge employment opportunities in the country, and a flow-on effect to many sectors - a phenomenon which is increasingly highlighted in reports.
The Organization for Economic Cooperation and Development (OECD) in its Employment Outlook 2007 report released this week has said that India, the world's second-fastest growing economy after China, generated more than 11.3 million new jobs every year from 2000 and 2005 - higher than Brazil (2.7 million), Russia (0.7 million) and China (7 million).
This bloc of four countries is referred to as the BRIC nations. Paris-based OECD comprises 30 developed countries, including the US, UK, France, Germany and Japan.
The OECD report comes in the wake of other indicators of high employment avenues in India, resulting in a manpower crunch as well.
Federal Finance Minister P Chidambaram recently said that the Indian economy should grow at 10 per cent in the current fiscal year, following on 9.4 per cent in the last fiscal year and 9 per cent in 2005-2006.
In a recent study, industry body, the Associated Chambers of Commerce and Industry in India (Assocham), has identified aviation, hospitality, brokerages, insurance, software, business outsourcing and retail as sectors that will generate maximum jobs for young people.
RE:INDIA
by Amit Arora on Jul 26, 2007 12:19 PM Permalink
In another study, it said that the country's booming construction industry, currently at US$70 billion, will rise to US$120 billion by 2010, requiring manpower of over 90 million from the current 30 million. The OECD report says that India also has the lowest rate of jobless people among BRIC nations. The country's unemployment rate stood at 6 per cent in 2005, compared with China's 8.3 per cent, Russia's 7.9 per cent and Brazil's 9.3 per cent. Moreover, the employment to population ratio is also lowest in India, the world's second-most populous country after China, at 50.5 per cent in 2005. In contrast, it stood at between 66-71 per cent in the other three BRIC countries. The study "Job Opportunities in Emerging Sectors" by Assocham said that high consumer spending has resulted in big interest in the retail sector, 97 per cent of which is still unorganised. It is estimated that the organised segment alone will add up to US$14 billion in market size by 2010 to cross US$21.5 billion, creating two million jobs directly. The hotel sector will need a new workforce of at least 94,000 by 2010-11.The aviation space is growing at 25 per cent yearly. The industry is expected to add 130 planes to the current fleet of 270 airliners and create 200,000 jobs by 2017, the study also said. The information technology (IT) and IT-enabled sector - the biggest employment generator - with a work force of 1.63 million in recent times, will continue to hire most aggressively and is expected to fall
RE:INDIA
by T D on Jul 30, 2007 01:27 AM Permalink
"The OECD report says that India also has the lowest rate of jobless people among BRIC nations. The country's unemployment rate stood at 6 per cent in 2005, compared with China's 8.3 per cent, Russia's 7.9 per cent and Brazil's 9.3 per cent. Moreover, the employment to population ratio is also lowest in India, the world's second-most populous country after China, at 50.5 per cent in 2005. In contrast, it stood at between 66-71 per cent in the other three BRIC countries."
Aren't these statements contradictory? India is supposed to have lower unemployment rate as well as employment rate? Which number should we feel happy about?
RE:INDIA
by Kannan Palaniswamy on Jul 26, 2007 12:36 PM Permalink
We use to buy parts from Japan in Dollars. As soon Dollar value came down in 2005 similar to current scenario, Japaneesse company changed the currency to Yen to save themselves. So our exporters have to be clever these kind of problems.
RE:INDIA
by saravana kodandapani on Jul 26, 2007 08:03 PM Permalink
You can only do that if you are exporting items on the higher end of the value chain like automobile components,Nuclear submarines etc. You cannot do that if you are exporting textiles,peanuts etc
