Can The Rupee Be Saved-- Yes -- If There Is A Will There Are Ways

There is tremendous dismay in the country, due to the free fall of rupee from 45 to the dollar a few months ago, to the present 55 to the dollar. There is speculation that it can fall to Rs 60 shortly. WHAT IS THE GOVERNMENT DOING TO STOP THIS FALL IS NOT CLEAR.

The matter hardly comes up for discussion in the Parliament. When it does come up, the Finance Minister only concurs with the expressed  views and says tough measures will be taken. When? A few days back he blamed the crisis in Greece for the fall of the rupee. It is like saying there

is weakness in Greece's economy because of the falling Indian rupee. True, international  reasons, are not under our control but are we in control of domestic reasons, leading to the fall in Indian rupee. Is it a totally international phenomenon.

Why is there a fiscal deficit in the Indian budget to the tune of 5.6 % and expected to increase furthur at the end of fthis fiscal ,thereby bringing the economy of the country into increased stress. Are USA or UK responsible for our fiscal deficit and can they control it. Why isthe government required to spend more than its income. Is the voter impressed by this.

Why is there no control on unproductive imports of gold to the tune of more than  $ 55 billion annually, when dollar is in short supply and costly .Why does not the Govt. educate the people of India, regarding this unproductive asset acquirement by its citizens. Must the govt. keep its mouth shut so that it does not become unpopular even if it affects the economy badly.

Why does the government carry the burden of lakhs of crores of rupees for subsidy purposes ? It looks ridiculous that the government should be providing a subsidy of Rs 60,000 crore on supply of LPG to its users. Even Mukesh Ambani and Ratan Tata and Kumaramanglam Birla are using subsidised LPG in their kitchens and the

govt. does not know how to remove this subsidy. It is simple, just go ahead and do it ,remove the subsidy 100 %. The release of Rs 60,000 crore will help govt. to  utilise it elsewhere and the fiscal deficit will also go down. Also that much less burden will be there on the tax payers. The only persons protesting will be a few, you know who,in Kolkatta and the Communists everywhere. Will the government have the spine to do away with LPG subsidies. The consumers will adjust to it.

By removing the subsidies,the government will thus need that much less revenue and this can be used to offset the increase in petrol and diese pricesl. Why should in the first place both be subsidised. Remove subsidies on them and pass on the revenues saved to the consumer by lowerig taxes and duties, thus putting some more money in the consumer's pocket, which he can use to buy LPG, petrol and diesel at actual costs. 

By reducing its revenue requirements, there will be a slight rise in prices, but then the new prices will be actual prices and not propped up and subsidy based prices. The need for the government to periodically help the exporters by silent devaluation of the rupee will not arise and the stable rupee will not contribute to escalation in domestic prices of imports.  

Finally the peopleof India must now elect a single party with a majority of its own and the new Finance Minister should not be aged more than 35 years, otherwise the same old and worn out ideas will keep being recycled back and the poor rupee will have to continue keep giving way to the dollar. Jinhe naaz hai hind per woh kahan hai.

Article Written By vks1000

Am a retired professional who is now into education of International Business and management topics. I enjoy writing and like reading on politics,economics,management and films. I take life as it comes and try to keep myself busy with a variety of activities.

Last updated on 12-05-2016 53 0

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