Speaking at HTLS 2025, Finance Minister Nirmala Sitharaman discussed the Indian rupee's performance against the dollar, emphasising the need to focus on current economic fundamentals. Despite the rupee's decline, she remains optimistic about India's growth trajectory.
Speaking at HTLS 2025, Finance Minister Nirmala Sitharaman discussed the Indian rupee's performance against the dollar, emphasising the need to focus on current economic fundamentals. Despite the rupee's decline, she remains optimistic about India's growth trajectory.
As the Indian rupee hovers near its record low against the US dollar, Union Finance Minister Nirmala Sitharaman believes the Indian currency will find its way amid India's strong growth outlook.
"The rupee will have to find its own way," said the FM in an interaction at the 23rd edition of the Hindustan Times Leadership Summit (HTLS).
The FM emphasised that the debate over the currency levels should include the present economic realities rather than comparing them to past situations.
"Look at the fundamentals of the economy. Look at the growth. The currency debate must be circumscribed by present realities rather than compared in a black-and-white manner with past situations," said the FM.
"As far as the rupee–dollar exchange rate is concerned, when the value of the currency comes down, the natural argument is that exporters should capitalise on it. By coincidence, some people point out that, at a time of US tariffs, this seems to offer some respite. Even if that is true, I am not fully satisfied with that explanation — but it is true that the economy's strength must be assessed alongside it," the FM added.
The Indian rupee hit an all-time low of ₹90.46 per US dollar on December 4, primarily due to the delay in the India-US trade deal and continuous foreign capital outflow from the Indian stock market.
Notably, the domestic currency is weakening against the dollar when retail inflation is at a record low and GDP growth is above 8%.
India's Q2FY26 GDP growth surged to a six-quarter high of 8.2%. On the other hand, India's retail inflation plunged to a record low of 0.25% in October.
The FM believes the Indian economy's growth seen in the second quarter will sustain, and overall, this year's (FY26) growth may be 7% or even higher.
Answering the question on the two bold reforms- the income tax cut and the rationalisation of GST rates- the FM said their impact could be assessed more clearly after some time.
"With respect to income tax, the assessment in terms of tax collection will come only next year, but we are already seeing the impact on spending. As for GST changes, because they apply across the board, we should evaluate them over the medium term," said the FM.