The rupee depreciation against major world currencies is good for the economy as it encourages labour-intensive exports from India, increases foreign exchange earnings and generates more jobs, former Niti Aayog Vice Chairman Rajiv Kumar said on Tuesday.
“Nothing to worry about rupee depreciating against major world currencies. In fact, it is good for the economy as it encourages labour-intensive exports from India, increases foreign exchange earnings and generates more jobs,” Kumar said in a post on X.
The Indian Rupees has depreciated a lot against the US Dollar and has fallen below 90. This is for the first time that the rupee has fallen so low. Yesterday 1 US Dollar was equal to 90.18 INR.
Let’s Understand: Is it Good?
A fall of the Indian Rupee below 90 against the US dollar does not automatically mean that the economy is doing well. It brings both advantages and disadvantages, and the overall impact depends on the wider economic situation.
A weaker rupee can help export-oriented sectors like IT, textiles, and pharmaceuticals because Indian goods become cheaper for foreign buyers. It can also benefit families receiving foreign remittances, since they get more rupees for every dollar.
However, for a country like India that depends heavily on imports — especially crude oil, electronics, machinery, and other raw materials — a weaker currency increases costs inside the country. This can raise inflation, make overseas travel, education, and medical treatment more expensive, and put financial pressure on companies that borrow in dollars.
When the rupee falls sharply due to reasons like capital outflows, weak trade flows, or global uncertainty, it may actually signal stress rather than strength. So, the currency slipping beyond ₹90 per dollar does not by itself indicate a “good economy.”
It is more accurate to say that it reflects a mixed situation, with some sectors gaining, many others losing, and underlying challenges that need careful management.
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