What Happens if Indian Rupee Equal to US Dollar?
Why can’t we print money and pay all debt? Quite funny….Leave it. What happen if our Indian Rupee is equal to USD in very short period of time? Even though the value of currency doesn’t account for stronger economy, there are lot of advantages we have, if Indian Rupee equal to US Dollar. Buying foreign goods will be cheaper. For an example you can get Iphone 7 for just INR 800. Not only that, petrol and Diesel prices will be high affordable hence it reduce transportation cost, which immediately results in reduction of all essential commodities in India. Its really good right?
But there are more drawbacks, if Indian Rupee value is equal to US dollar in a short period of time. Exports of our products will become expensive, which discourage the foreign consumers to change the market. I think, you might be aware of currency devaluation by china. In china, the government use fixed rate for their currencies. In order to strengthen their exports, China decreases its currency value while compared to USD.
No foreign investment will happen in India. Indian companies and Foreign companies in India will recruit manpower from other countries as they can pay just Rs 2000 or Rs 4000 for their employees. Service sector of our country will affect a lot as it is dominated by foreign companies. People will lose jobs and in turn creates unemployablity. If investment is not coming to India which results in economic slow down. Companies which are present in India will start to move out as it won’t be profitable to them.
So a sudden increase in Rupee value is not good for a developing country like India. You can ask me why to boycott foreign goods and use swadeshi. Swadeshi is good but there are lot of chances for other countries to stop using our products. The export rate of our country will fall. As a good citizen, we have the full freedom to use our indigenous products, but if our government make it as a rule then we’ve to face some serious issues. There is a chance of loosing our Dollar reserves due to lack of exports. The stabilization of Indian Rupee is an important thing. If US dollar rate for today is 65 and tomorrow is 70 or 50, the fluctuation will affect our economy. So this is in the hands of RBI and Finance Ministry.
You can check my earlier post “How Indian Rupee Value can be increased against US Dollars“, if you plan to do something good for the Indian economy.
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