The rupee can take care of itself : CEA | The Financial Express

The rupee can take care of itself : CEA

Speaking at the Mindmine Summit here, the CEA said, “India is not defending the rupee… I don’t think Indian fundamentals are such that we need to defend the rupee. The rupee can take care of itself.”

The rupee can take care of itself : CEA
Chief Economic Advisor (CEA) V Anantha Nageswaran

India hasn’t turned aggressive in its defence of the rupee and the central bank is only initiating necessary steps to ensure an orderly movement of the currency, which is in sync with market trends, chief economic advisor (CEA) V Anantha Nageswaran said on Tuesday.

Speaking at the Mindmine Summit here, the CEA said, “India is not defending the rupee… I don’t think Indian fundamentals are such that we need to defend the rupee. The rupee can take care of itself.”

The rupee has recovered from its record fall to 80.12 against the dollar in intraday trade in August. On Tuesday, it rose 36 paise against the dollar and settled at 79.17. Its depreciation of over 6% against the dollar this year is better than the currencies of India’s peers.

“The RBI is making sure that whatever direction the rupee is moving in line with the market trends is just gradual and doesn’t impose burden either on the importers or the exporters,” Nageswaran said.

Commenting on a drop in the country’s foreign exchange reserves in recent months, the CEA said, “Global risk aversion prevents capital from coming in. Naturally that is what reserves are meant for.”

The foreign exchange reserves hit an almost two-year low of $553 billion as of September 2, according to the RBI data. The reserves have dropped by $89 billion this year but are still enough to cover nearly nine months of imports.

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India to grow at 7% annually this decade

India will likely grow at about 7% a year in the current decade on the back of a rise in investments and digital economy, chief economic advisor (CEA) V Anantha Nageswaran said on Tuesday.

Late last month, the finance ministry said growth could be to the tune of 7-7.5% in FY23 after the first quarter data showed an expansion of 13.5% from a year before.

“While international agencies are showing our trend growth at 6%, I feel the trend growth will easily be 7% per annum for the remainder of this decade and beyond,” Nageswaran said at an event here.

“I am taking 6% as the very easily attainable growth rate and I am adding 0.5% coming from the capex (capital expenditure) pool and another 0.5% will come from the digital public infrastructure that we have created.”

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