“The
center should not be worried by falling rupee, instead, it should use the
situation to push our exports and establish investors’ faith in the Indian
Story.”
Why
we are in panic? Weakened rupee is an opportunity. I wonder why our finance
Minister is battling to stem the collapse of the Indian rupee from the 55 for a
dollar a month ago to 67 this week. He really should be busy to exploit this
opportunity.
The
fall of the rupee is a political, not an economic disaster. Our traders and big
businesses, which have been growing based on cheap China imports, are in panic.
Our
foreign exchange reserves at about $250 billion are low, but nothing to panic
about when exports grow, imports drop and investors start knocking our doors
once again. So, the government should get busy with removing the structural
impediments in export by reducing formalities and with innovative incentives to
push exports.
Let
us reward those exporters, who have a large domestic value added with full tax
exemption. If the government does this on a priority basis, both Indian and
foreign investors will flock around us like they did to invest in China.
It
is good that measures are being taken to curb imports with increased import
duties on gold and consumer durables and raising short-term interest rates to
shoo away the currency speculators. Weak rupee will have a positive effect on
FDI. Let us give incentives like tax relief, quick response at the entry points
for import of raw goods by exporters and speedy product export clearances,
which help making our exports more competitive.
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