Depreciating value of Rupee in India is bound to some real major impact on the Indian Industry. The damage would be big and scary as the production units and manufacturing organizations would be affected by large.
In case, the value of Rupee in India continues to deteriorate, the trade deficit that India will generate may not be containable even with a lot of effort. This will form a vicious circle of low flow of foreign investments and the overall growth revival of the nation will, once again take toil.
Since the fiscal deficit and current account has already touched alarming peaks, they are creating serious challenges in front of the policy makers for management of economy. Depreciation of rupee in such a scenario is further going to increase the government’s anxiety. It is a common observation that the rupee being weak is not powerful enough to buy trade and initiate growth in exports and thereby giving scope to improve trade balances. The global demand condition greatly affects the export Indian scenario.