A Testament to Improved Economic Management
Amit Malviya, a leader of the Bharatiya Janata Party (BJP), has praised the resilience of the Indian rupee, crediting improved economic management under the Modi government for making it "one of the most stable currencies globally."
In a post on social media, Malviya highlighted key metrics such as India's reduced current account deficit, strong foreign exchange reserves, and restrained external debt growth, which he said have contributed to the rupee's stability despite global challenges.
He stated that over the past year, even as the US Dollar Index surged by 9.8%, the rupee depreciated by a modest 3.68%, outperforming major currencies like the Japanese Yen and Korean Won, which fell by 9% to 12% during the same period.
Malviya contrasted the rupee's performance under the Modi government with its vulnerability during the UPA era, emphasizing that the Indian currency depreciated by 36% between 2011 and 2013. He attributed this to "reckless external borrowing" during the UPA era, which left the currency exposed to global shocks.
In contrast, Malviya said the Modi government's "fiscal prudence" has limited external debt growth to just 4.5% annually, ensuring greater economic stability. He also pointed out the stark difference in the rupee's response to the US Federal Reserve's tapering announcements.
In 2013, following the Fed's tapering signal, the rupee depreciated by 14.9% within four months, reflecting what Malviya called "policy paralysis" under the UPA regime. In contrast, after a similar announcement in 2021, the rupee declined by only 0.7% over the same period, showcasing India's stronger economic foundations.
Malviya also highlighted that the rupee has strengthened against non-dollar currencies like the Euro and Canadian Dollar, a scenario he described as "unheard of in 2013." Despite ongoing geopolitical tensions and high US interest rates, India has avoided a currency crisis, a testament to prudent economic management and robust fundamentals, he asserted.
Malviya concluded by stating that the rupee's performance under the Modi government is a remarkable turnaround from its disastrous performance under the UPA. He emphasized that the rupee's stability is no coincidence, but rather a result of improved economic management.