De-valuation of the Indian Rupee

The Indian Rupee’s value has been depreciated to a very low level. The RBI (Reserve Bank of India) has taken steps to stop the nose-diving Rupee. Even then, the value of the Indian Rupee against the US Dollar is becoming lower and lower and lower. RBI measures are not enough and it is  too late to recover the status of the Indian currency, the Rupee. RBI is raising the limits FII investment limit is raised to $20 billion, QFI can invest in Mutual Funds, and even ECB limits have been raised.FII limit is raised so that investors can buy more government bonds. But with lack of confidence in Indian economic policies (constantly changing) investors are scared. These ‘raising of limits’ may attract short-term investors who want to make a quick buck and leave. These measures would harm the Indian economy than help it.Equity investment from overseas can help us recover.If Foreign Direct Investment in retaling was allowed earlier, it could have helped. Now the new steps may lead to a dangerous trend. Now, government debt would depend directly on overseas investments--as they can buy government bonds. And repayment will become harder and harder. We are entering a pit of quicksand.Indian economy is most vulnerable now. Indian people are buying gold from overseas, and this is facilitated by banks. When we do this, we are driving the Indian Rupee spiraling downwards.RBI’s rate cuts cannot arrest Inflation. Controlling inflation would require a whole new set of government policies and allocation of government expenditures. Growth has been arrested by lopsided policies. Unless gross changes are made to re-work economic plans, we have tougher times ahead.