As the rupee slipped to an all-time low against the dollar on Wednesday, founder and director of Kotak Mahindra Bank Uday Kotak said it was time for Indian businesses to “shake out of comfort zone”.
The veteran banker attributed the decline to foreign institutions selling Indian equities and said for now they “seem smarter” as local investors continue their buying spree.
What did Uday say?
“Re@90. The proximate reason: foreign selling of Indian stocks both FPI & PE under FDI. Indian investors buying. Time will tell who is smarter. For now foreigners seem smarter. 1 year nifty $ return is 0. But this a long game. Time for Indian business to shake out of comfort zone,” he said in a post on X.
Rupee becomes the worst Asian performer
The rupee is one of Asia’s worst performers, having fallen over 5% against the dollar year-to-date. In terms of portfolio outflows, India is one of the worst hit markets globally, with foreign investors’ net selling of its stocks amounting to nearly $17 billion so far this year.
The weakness in portfolio investment has also coincided with a slowdown in foreign direct investment, adding to the pressure.