Newsmaker: Rupee
Meghna Maiti
In the last three
months, rupee’s depreciation has grown to the point where the Indian currency
seems like a dark, sinister force like a muddled-up mind in a sound body.
“Muddled-up” implies people following a path that appears like a wide boulevard
strewn with silver roses – a sort of future mainly driven by illusion- the way
volatility of rupee has become in the lives of common people. Perhaps even more
so, the rupee has come to seem like a potent, disruptive force, a confusing
phenomena; rupee fall is to the common man what greed is to nature. When common
men say they have been hit hard by the rupee fall- they are at this point
indicating not just a temporary phenomena but an entire way of being in an
increasingly uncertain world: a fear for unmet basic needs; fear for unmet
not-so-basic desires; fear for man-made disasters and to top it all- fear for
survival- the quest for the ever-growing doubts- how to survive and at what
cost.
Our beloved national
symbol is plumbing new lows in an economy heavily dependent on imports for the
goods Indians can't do without namely gold and petroleum products such as
petrol, diesel, kerosene and gas. The rupee has depreciated nearly 12 per cent
since the beginning of the fiscal year in April 2013 and reached an all-time
low of 60.73 against the US dollar on June 26, 2013. Between April 2011 and
April 2013, the rupee lost nearly one-third of its value versus the US
dollar. It is the biggest loser apparently among currencies worldwide. While
its making overseas travel expensive, it is increasing costs for students
studying overseas and making those working abroad unsure as to whether they
should send money to India now or wait for further depreciation. It has also
been increasing costs of fast moving consumer goods such as soaps, detergents,
deodorants and shampoos, of which crude oil is a component.
The depreciation of
rupee has had an impact on the automobile sector. While the input costs of
imported components have risen, the companies have to pay high royalty to the
parent firms. Similarly, electronic consumer goods such as mobile phones,
computers, and television have become costlier. Food chains are also facing an
impact on their profitability.
However, even in the
wake of such crisis as rupee continues to slide against dollar, it has found a way to keep its name,
meaning something remarkably unique and pure. It has sort of retained a tightly controlled, evocative sense of
magic and mystery over its image with
the power over humankind to hypnotize, agitate and liberate. Industry
experts say the majority of the people do not blame rupee or its usage for its
problem. They blame others- including the dollar on a horse ride, recession in
the euro zone, bleak fundamental outlook, no balance at balance of payments.
Finally, the value of
a currency is the proof of the efficiency and reliability of the government
that issued it. To quote John Maynard Keynes- “"By a continuing process of
inflation, governments can confiscate, secretly and unobserved, an important
part of the wealth of their citizens. By this method, they not only confiscate,
but they confiscate arbitrarily; and, while the process impoverishes many, it
actually enriches some. The sight of this arbitrary rearrangement of riches
strikes not only at security, but at confidence in the equity of the existing
distribution of wealth.”
ENDS
No comments:
Post a Comment