While a declining rupee rate might quite clearly bring the divide between being an Indian, living in India and not living in India. India as a whole faces the effect it has on our economy. While many economists have predicted this downfall in the value of rupee rate ever since 2007, what is astounding is how there seems to be no solid plan to take action against it. ‘So what is the big deal with a falling rupee value anyway?’ one would ask. This requires us to understand how much lesser our valuable commodities are being sold for. To familiarize ourselves with this concept, it is necessary to rewind back a few years and conceptualize how our rupee as a system has undergone tremendous devaluation. Not many of us are aware of the fact that at the time when India gained independence in 1947, the value of 1 rupee = 1 dollar (US $). Astounding, isn't it? This would mean, say India sold one mango worth 1 rupee to the US, it would get back 1 dollar in return. Now take for example, India purchases one mobile phone from the US worth 1$ and we would give them 1 rupee in return. How just and strong was the Indian rupee at that point in time.
To realize the extent of deterioration, in today’s world, India needs to sell 58 such 1947 quality mangoes to get back 1$. Doesn't that seem like a very big loss? Why should a farmer toil his way to get one dollar in exchange of a sack full of mangoes? As unfair as this seems, this is the state of our Indian market today. The mangoes being just about any valuable commodity our country produces. As inflation rises, the rupee just keeps getting weaker. Eventually local prices hike, making it very hard for a common man to tackle everyday expenses. As NRI’s for sure we get a better deal on remittance. The World Bank report states India receiving the largest amount of remittances in the world from non residential Indians. However, we need to ask ourselves, is that what we want for our nation, a country relying heavily on its foreign workers to nourish it? What happens to the millions who do not have that opportunity to be at the receiving end of the remittance?
Have we thought of those several aspiring students withholding their higher studies abroad due to the weak rupee and their inability to get funding? The infrastructure and development that is put on hold due to budget deficit & the hiked petrol prices. The commodity prices are rising due to increased transportation costs. Doesn't it all add up to a very heavy economic burden? Being non residents we can be deluded with our narrow reasoning of it not affecting us. Perhaps gloat about how much more value our 1$ coin is worth in terms of Indian rupees. Yet, the increasing economic burden on our country’s aam janta is a cause of great concern, the draining of its resources for a price so not worth its true value is a source of injustice, its young population working for international companies at a fraction of its pay is a drain of talent. After all this, if we still have the courage to rejoice at a falling rupee, we are in fact rejoicing at a failing India. Not quite what we thought of it to be.
Image courtesy : plus.google.com
Adopted from : my post on http://www.nrimatters.com/power-nris/a-falling-rupee-a-failing-indian-economy
