The Rupee’s Decline: A Call for Governance, Accountability, and Economic Reform

 

The Rupee’s Decline: A Call for Governance, Accountability, and Economic Reform

The Indian rupee has been steadily losing value, dropping from ₹83 to ₹86 against the US dollar in recent months. While a 3.6% depreciation might seem insignificant at first glance, its implications for an economy valued at $4 trillion are profound, amounting to a staggering $140 billion loss. This erosion in economic value demands serious attention. Yet, the silence from the government is conspicuous, especially when compared to the rhetoric of Prime Minister Narendra Modi before 2014. Back then, even minor fluctuations in the rupee’s value were met with loud condemnations of the incumbent administration. Today, under Modi’s leadership, the rupee has fallen by over 33%, and the irony is unmistakable.

This depreciation is not driven by election anxiety, as there is no imminent national vote. However, the government’s tenuous position, reliant on smaller coalition partners for survival, has created an air of political uncertainty. Investors, wary of the fragile alliances that prop up the administration, remain cautious. This political instability has only compounded the rupee’s vulnerability in an already challenging global environment.

The decline of the rupee is not merely a political talking point but a reflection of deeper issues in economic governance. Many Indians remain unaware of how a weaker rupee directly affects their lives. Rising energy costs, higher import prices, and inflated costs for domestically manufactured goods are just a few of the cascading consequences of currency depreciation. For ordinary citizens, this translates to a higher cost of living. However, the connection between the rupee’s value and their shrinking purchasing power is often lost in the noise of misinformation and misdirection. This ignorance benefits a select few, notably corporate titans like Ambani and Adani, who continue to thrive in an environment where regulatory oversight is conspicuously absent.

The recent 25% hike in data usage prices by Reliance is a prime example. Despite its direct impact on consumers, the increase faced no regulatory pushback. For ordinary Indians, rising prices mean stretched budgets; for the country’s wealthiest, they are a convenient avenue for greater profits. Meanwhile, corruption and cronyism continue to erode economic stability. Allegations of misconduct against Adani, including investigations by the U.S. Justice Department, have cast a long shadow over investor confidence. Such scandals undermine India’s reputation and create additional downward pressure on the rupee.

Adding to the rupee’s woes are policies that favor the few at the expense of the many. The government’s decision to waive ₹16 lakh crore in corporate loans is emblematic of this imbalance. These waivers, rather than driving growth or innovation, exacerbate inflation and weaken the rupee further. Global financial institutions like the IMF and World Bank are well aware of such structural weaknesses and often respond by tightening economic conditions for countries that fail to demonstrate fiscal responsibility.

In the midst of this bleak economic landscape, the AAP government in Delhi stands out as an example of what efficient governance can achieve. By prioritizing public welfare, the Delhi administration has delivered free healthcare, quality education, and subsidized utilities to over 20 million residents. According to U.S. standards, providing healthcare to this population equates to a $50 billion healthcare economy, while quality education adds another $25 billion. Together, these initiatives suggest that Delhi’s economy should function at a scale of at least $75 billion, requiring a budget of ₹6.45 lakh crore to sustain. Yet, with a budget of just ₹80,000 crore, the Delhi government has achieved remarkable results, demonstrating that efficient use of resources can deliver substantial outcomes.

If Delhi were a standalone nation, its currency might well be stronger than the Indian rupee. Investing in public welfare, rather than funneling wealth into the hands of a few, creates resilience in both the economy and its currency. Critics of AAP’s policies may scoff, but the evidence speaks for itself. The efficiency, transparency, and focus on people-centric governance offer a stark contrast to the cronyism and inefficiency that plague national policymaking.

India’s currency, like any other, reflects the priorities and strength of the nation it represents. Currently, those priorities appear misaligned, favoring the powerful over the populace. To reverse the rupee’s decline, India must take decisive action. Education must be prioritized to create a more informed and innovative workforce. Energy independence is essential to reduce the outflow of foreign reserves for fuel imports. Most importantly, corruption must be rooted out. Loan waivers for corporations and bloated contracts that benefit a select few at the expense of the many must be replaced with policies that drive equitable growth and sustainable development.

The rupee’s fall is more than just an economic statistic; it is a symbol of governance failure and misplaced priorities. India has the potential to be an economic powerhouse, but this potential will remain unrealized without significant reform. To restore the rupee’s value and bolster the nation’s economic stability, India must focus on empowering its citizens, promoting transparency, and ensuring fiscal discipline. Only then can the rupee truly reflect the strength and promise of the nation it represents.