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Rupee Weakness Aligns with Emerging Markets, Says CEA Nageswaran

Chief Economic Adviser V. Anantha Nageswaran stated that the Indian rupee's depreciation against the US dollar is consistent with trends seen in other emerging market currencies facing similar geopolitical risks. He emphasized that strong economic fundamentals and continued structural reforms will lead investors to reassess and strengthen the rupee over time. The currency traded weak near 91.94 amid market caution ahead of the Union Budget, pressured by high gold imports and foreign investor outflows. Nageswaran highlighted the need for domestic capacity building and supply chain resilience in a fragmented global trade environment.

Key Points: CEA: Rupee Weakness in Line with Other Emerging Market Currencies

  • Rupee weakness mirrors other emerging markets
  • Fundamentals remain strong for investor reappraisal
  • Structural reforms key to currency consolidation
  • Geopolitical risks and trade fragmentation are global challenges
  • Focus on domestic capacity and supply chain resilience
2 min read

Weakness of rupee not out of line with other emerging market currencies: CEA Nageswaran

CEA V. Anantha Nageswaran states the rupee's fall is consistent with global trends, citing strong fundamentals and reforms for future stability.

"We are not rich by nature, but can become rich by policy. - V. Anantha Nageswaran"

New Delhi, Jan 29

Chief Economic Adviser V. Anantha Nageswaran said on Thursday that the weakness of the Indian rupee compared to the US dollar is not out of line with other emerging market currencies, which are also going through the same geopolitical risks.

Responding to an IANS question in the national capital, Nageswaran said that as the fundamentals continue to display strength and solidity, investors will reappraise their stance towards the Indian currency.

"If we continue on the path of structural reforms, as we have been doing in the last 12 to 18 months, both at the Centre as well as state governments, and Indian exports continue to show growth, that will also further consolidate the revised perceptions on the Indian rupee going forward," the CEA noted.

In the short run, some developments may not be in our control, but more importantly, "the fact that the rupee is not reflecting macro-fundamentals, and the sustained growth rate, will definitely catch the attention of investors and that is when the tide will turn," Nageswaran told IANS during a press conference after the Economic Survey 2025-26 was tabled in the Parliament by Finance Minister Nirmala Sitharaman.

Rupee traded flat to weak near 91.94, down 0.12, on Thursday as markets remained cautious ahead of the Union Budget on February 1. The currency has been under pressure due to elevated bullion prices increasing the import bill, along with continued FII selling in domestic equities.

Nageswaran further stressed that in a world marked by trade fragmentation and geopolitical tensions, countries must focus on domestic capacity building, supply chain resilience, and strategic indispensability in global value chains.

"We are not rich by nature, but can become rich by policy,"" he said, expressing confidence that continued reforms and responsible participation by government, industry, and citizens will help India achieve its long-term development goals.

- IANS

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Reader Comments

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Priyanka N
It's easy for experts to talk about macro-fundamentals, but what about the common person? A weak rupee means more expensive petrol, more expensive electronics, more expensive imports. My household budget is feeling the pinch every single day. The government needs to address this impact on the ground.
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Aman W
"We are not rich by nature, but can become rich by policy." What a powerful statement. This is the mindset we need. Instead of just complaining, we need to build domestic capacity. Make in India is more important than ever. Let's support our local industries.
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Sarah B
As an expat working here, I see both sides. The short-term volatility is worrying for business planning, but the long-term structural reforms are genuinely impressive. If India stays the course on policy, investor confidence will return. The Budget will be key.
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Karthik V
The point about gold imports is crucial. We Indians have a huge appetite for gold, and when prices are high, it drains our forex. Maybe this is a cultural moment to rethink our obsession with physical gold for weddings and investments. Digital gold or other assets?
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Varun X
Respectfully, while I understand the global context, I feel the government could be more proactive in managing currency volatility. Let's not just compare ourselves to weaker economies. We should aim for stability like some of the stronger Asian currencies. Hope the Budget has some concrete measures.

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