This report is showing the negative aspects of raising rupee. It should have depicted the long term benefits of raising rupee. Raising rupee value is very good for india in long term (though NOT for indian IT companies which tried their best to retain rupee as low as possible in value)..we should stop undervaluing our rupee and ourself..
RE:Raising rupee good for India
by on Jul 26, 2007 08:25 AM Permalink
Strengthening rupee never going to be good for india. Millions going to be jobless due to exports are not competitive and this going to creat so much social problems. Your local product cannot be sold due to import goods are cheap.even like imported tea,cofee or rice will be cheaper than india products. Again many local companys will close and creat lot of unemployment. What is that our government want to achive by making millians unemployed and starving. Strengthening rupee only going to benifit unproductive stock market players. out of $150billion export if you loose 12% it is $18billion equivalant local rupee.who can sustain this loss. The main reason they mention for rupee strenghthening is $9billon flow in stock market which makes local companies to loose $18billion equivalant rupee. Government should see that indian products are cheaper like china doing. Even now China getting more foroegn investment and their import/export balance is surplus.Thier currency did not appriate like indian rupee. i strongly beleive this is a gambling to shake the indian industry.
RE:Raising rupee good for India
by Sai Akkanapragada on Jul 27, 2007 09:09 AM | Hide message
Currency exchange rate depends on the following, 1. Investment flow - FDI and speculative - Capital account 2. Current account - exports and imports. The reason why India is getting lot of foreign investment both FDI and speculative is because MNCs are expecting a good return for all the USD they invest in India. When will this happen? When the consumers both retail and corporate have good disposable incomes and purchasing power. Does this require Indian rupee to be weak because most of the jobs created in the last 5 years were due to outsourcing which led to a huge Indian middle class with lot of disposable income. This leads us to believe that Indian rupee has to be weak but due to capital inflows Indian rupee is becoming stronger in the short term. This may lead to lower revenues for exporters in IT, ITES but costs are also lowered as price of oil,imported manufactured goods etc will be cheaper. Will this lead to the death of Indian mfg, if the immediate impact is only to revenue and not cost.Yes. 2. We also need to analyze what percentage of India's GDP is exports. If we don't export value added products, our exports will be directly impacted by currency fluctuation.We end up earning less for the precious resources we export if the Rupee appreciates.If the way India is going to earn money is going to be through labor, example IT and diamond cutting, it is in India's interest to prevent the rupee from appreciating. One way to do it is to artificially peg the curren
RE:Raising rupee good for India
by chigurupati venkateswarlu on Jul 26, 2007 07:53 AM Permalink
Can you tell me few positive aspects? And also just compare the negative aspects against positive aspects and let everybody know. If you cannot, just sut
RE:Raising rupee good for India
by shashidhar biradar on Jul 26, 2007 08:11 AM Permalink
1. It has easened the Loan that we have borrowed from the west i.e 130-150 $ billion we can pay some of the amount. 2. We can Purchase capital goods from USA or from west by giving less ruppes 3. Petroleum sector is major winner as they have to pay less rupees. 4. Petrol and diesel were cheap inflation will be within RBI Norms.
Lastly IT had party for last 10 years now if it doing not well then dont worry concentate on engg. sector
