It has both advantages and disadvantage. Mostly disadvantages are mentioned in the article. Now consider ONE OF the advantage. Suppose, the rupee appreciates to half, that is almost 21 to a US Dollar. Then, all the borrowings by private sector AND central AND state govts will be interesting. For example, if a state govt. has borrowed $1 billion at around Rs.42 a dollar, it got Rs.4,200 crore. Now when we have to pay back, we have to pay back only Rs.2,100 crore only, and not 4,200 crore!!!! And this is advantageous, because, state govts have their income only in rupees, and never in dollar or any foreign currency!!!! The same thing is true for central govt. And interestingly, it is true for all private sector and public sector companies. So, in appreciating rupee, it is advisable to pay back your outstanding debts in foreign currency. And borrow when rupee is depreciated. Consider central govt external debt of more than $125 Billion US and an equal amount jointly by listed companies and state govts!!!! Learn to play games to win. Remember, our economy is based on indian rupee and not in dollar. Central and State govt income and expenditure, and for companies and govt corporations. Foreign exchange comes in to picture when govt expenditure is more than its income AND when we import more than our export. Play game with other countries, with world bank and with IMF. And learn to win
