Falling Rupee

The editorial captures well all the issues causing depreciation of the rupee unabated.The country has limited control on external factors such as US approach to withdraw liquidity as a stance of its monetary policy,but definitely the Govt can have solid control to drive the domestic policies to suit its requirements and minimise the downfall of the rupee. The Govt  has failed to  take appropriate and timely measures to contain the import bill by containing the demand for gold when it was reaching the peak, improving the supply of coal by augmenting the production of quality coal domestically, creating an atmosphere to attract flow of funds from abroad by its taxation and ease of doing business through better administration and governance, controlling inflation and inflationary expectations by improving productivity, procurement,storage, distribution and marketing of food products in particular.The failure of the Government in containing Corruption and black money has added to the woes of the economy and the greed has overtaken the market in such a way that make money as much as possible at the quickest time through unquestioned and aggressive pricing in all areas is the philosophy practised shamelessly.The adverse impact of all round service tax without any rationale has added to the cost of everything in the economy and everything revolves around high cost and high inflation without any escape route.Trading in currency has also been adding to the problem as if ours is an advanced economy to accommodate that.Time to have an overall review of economic, monetary and administrative policies and fix the issues without further loss of time. First Signalling followed by concrete action is the need of the hour.

Dr.T.V.Gopalakrishnan
(This comment is in response to the editorial in Business Standard dated 11/6/13).