The Indian rupee has slipped to a lifetime low against the US dollar. According to forecasts by market analysts, it is likely to touch the 90.70-91 range. Amidst this backdrop, Union Finance Minister Nirmala Sitharaman made some significant comments at the Hindustan Times Leadership Summit.
The minister said the fall of the rupee is not all bad news. She elaborated that a situation like this benefits exporters. She asserted that the Indian economy's fundamentals remain strong. As per her, the performance of the economy now is much better than when the current government was in opposition. She added that the key economic fundamentals have been addressed.
Sitharaman said any discussion on rupee should be in the context of the contemporary situation. She said, “When the rupee depreciates, our exporters gain. In addition to this, tariffs on products make this proposition fairly decent. The strength of the economy is something to be viewed along with currency fluctuations. Currency fluctuations per se do not determine economic performance.
The minister also discussed issues related to family savings. She said that savings and investments are actually on the increase. Changes in traditional savings methods may create a perception that savings are falling, but in reality, savings are not decreasing. She further explained that assets are growing and bank loans are supporting such growth.
In the last few days, the rupee has weakened due to uncertainty that pertains to the trade deal between India and the US. Apart from this, foreign investment outflows weaken the rupee. Large-scale buying of dollars by importers to make payments for merchandise has hurt rupee value.
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