Why a Falling Rupee Hurts Your Pocket: The Truth Behind Asia's Worst-Performing Currency
The Indian rupee has become Asia's worst-performing currency this year. While the government repeats that we are the "fastest-growing major economy," the rupee tells a different story, having crossed 90 against the US dollar. So, should you care if you don't deal in dollars? Absolutely. Here’s why.
A currency falls when demand for dollars grows faster than demand for the rupee. It’s a signal that international investors or markets are becoming cautious. When the rupee weakens, the cost of imports rises. India imports crucial items like crude oil, medicines, fertilizers, and electronics. As the rupee falls, these essentials become more expensive, driving up prices for everyone—from fuel to farm inputs.
Some argue a weak rupee boosts exports. But India is not an export-led economy. We depend heavily on imports to keep our domestic economy running. The benefit to a few exporters is overshadowed by higher costs for the entire population. For the average person, a weaker rupee means your income buys less, and daily expenses climb.
There’s also an emotional and symbolic weight. A steadily declining currency impacts national prestige and signals economic stress. As one commentator noted, “When a currency goes down, it means all is not well in the economy.” Stability matters.
Who actually benefits? Companies with foreign assets see their valuations rise. Foreign investors find Indian assets cheaper. But the common citizen pays the price through inflated bills and stagnant wages. For instance, the rising cost of imports can push companies to cut labor costs, leading to longer hours or job insecurity for workers.
The government is the custodian of our currency. When officials downplay the fall or call it "good for exports," they ignore the real burden on households. The truth is, for an import-dependent nation like India, a weaker rupee fuels inflation, increases production costs, and squeezes the common Indian.
The solution isn’t simple—it requires strengthening domestic manufacturing, reducing import dependency, and ensuring policy protects the vulnerable. But the first step is acknowledging the problem: a falling rupee isn’t just a number on a screen; it’s a pressure on your budget. And that’s a question every citizen has the right to ask their government.
