Collapse of the rupee

Ostrich-like in peacock nation

Print edition : October 12, 2018

The rupee fell from just below Rs.64 to the dollar to close to Rs.73 to the dollar between the beginning of 2018 and mid September. Photo: Getty Images/iStockphoto

At a currency exchange in Montevideo, Uruguay, on September 6. India looks comfortable in comparison with the really poorly performing countries elsewhere on the globe, such as Argentina (where the peso depreciated by 114.8 per cent), Turkey (with the lira down 68.5 per cent) and Brazil (with the real down 27.3 per cent). What is missed in this complacent assessment is that these countries are in crisis. Photo: MIGUEL ROJO/AFP

The result of export failure was that large remittances from Indians working abroad and substantial receipts from exports of services helped rein in the current account deficit and stabilise the balance of payments in normal years. Photo: afasdf

The government’s much-delayed response to the collapse of the rupee, involving a set of anaemic measures based on faulty presumptions, is the opposite of what is needed.
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