Falling Indian rupee, its effects on economy and its cure
Indian Rupee is getting weaker against American Dollar. This is a big challenge that our economy is facing right now. Every day we hear about the depreciating value of Indian Rupee on news channels. According to some latest reports, Rupee has gained 19 Paise against American Dollar.
With Rupee constantly weakening, Indian economy will face lots of problems. This chart will show how Rupee has depreciated over the years against US Dollars.
What is responsible for this continuous weakening? Is it due to flawed economic policies of our Government? Or is it due to the economic recession that hit us few years ago? According to this report, Prime Minister Manmohan Singh has pointed out several factors responsible for falling Rupee.
How is this process going to affect our economy and daily lives? The effects of it are many. Rise in petrol prices is one of the ways this process is affecting common man. Oil companies are forced to shell out more money to buy oil due to a weakened Rupee. Thus, the Oil companies are forced to hike petrol prices every now and then.
Prices of imported goods also has skyrocketed since the steady decline of Rupee. If you are a travel freak and love visiting foreign countries, then you are set to face extra expenses. Since the Rupee is weakened, you will have to pay extra money. These are some common ways this process is affecting our economy and common man.
What is its cure? How to tackle this problem? The best way to solve this problem to an extent is by reducing the use of imported products. We must use more and more ‘desi’ products rather than going for foreign, imported products.
We can’t stop relying on imported technology and gadgets. They are very useful and are indispensible. But we can cut our imports of food, clothes etc. We can be more self reliant when it comes to the above mentioned commodities.
Another way is by reducing the consumption of petrol. Yes, by doing so, our consumption will decrease and thus the demand to import oil on oil companies will reduce. This will no doubt boost our economy.
We can reduce consumption of petrol by using public transportation instead of using cars/bikes, driving more carefully/economically etc. Industries should also keep a check on their petrol and diesel consumption. Steps should be taken by them to reduce consumption whenever possible. In short, it will take a collective effort to somewhat reduce this process of Indian Rupee weakening against US Dollars. Also, the Government policies must be aimed at strengthening Rupee.