Sluggish exports & weak Rupee: Great challenges for India

During the decade 2014-24, the compounded average growth rate (CAGR) of exports (goods & services) was reduced to 5 per cent from 17.9 per cent in 2004-14 and 12.7 per cent in 1994-2004 in USD basis.

- R P GUPTA

In sequel, Rupee is now weakened to about Rs.87.0 per USD against Rs.60.50 in 2013-14. During 2000-12, Rupee was stable with intermittent appreciation, mainly due to high export growth @19.5 per cent on CAGR basis in USD.

A strong and stable Rupee is not an impediment for the exports. I believe, higher economic efficiency will propel exports and keep Rupee stable.

And the economic efficiency depends upon the host of policies and regulations and not upon the producer alone. Obviously, a weak rupee is a dis-incentive for the global investors. India's investment needs can't be met from the domestic savings alone. Hence, continuous inflow of global funds is crucial for India till it becomes a "Trade-surplus Nation". Recent change in USA leadership has opened a tariff war; that might further affect exports. Hence, it is indeed a great challenge before India. I believe, India is capable of meeting such challenges.