The document discusses the depreciation of the Indian rupee against the US dollar over the past year. It notes that the rupee depreciated nearly 22% in the past year, making it the worst performing currency in Asia. It impacted various sectors of the Indian economy like automobiles, imports/exports, foreign direct investment, and transportation. The Reserve Bank of India took steps to control the falling rupee by introducing new regulations and controlling dependent variables. These steps helped stabilize the rupee over the following months.

1. Presented by:
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Shuheb I. Sayyad
Laxmikant N. Hatwar
Ajinkya M. Ramteke
ASMs IBMR
MBA First yr

2. 
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We are going to study about rupee deprecation against
dollar(USD).
Indian currency has depreciated close to 22% in last one
year against dollar(USD).
Indian currency is the biggest loser among the Asian
currency.
It affected different sector like automobile, import export,
FDI, Investment, Transportation etc.
Economic growth in India, in the first quarter (April-June
2013)Slipped down by 4.4%.
To control the rupee depreciation RBI took some effective
step, introduced new rules and regulation and brought the
rupee under control by controlling some dependent
variables.
Some key dates are as follows

4. Continued Global Uncertainty:
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Owing to uncertainty prevailing in Europe and slump in
international market investor refers to stay away from risk
investment.
Current Account Deficit:
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Countries total import of goods & services were more than
total export of goods and services. This is the primary
reason for rupee depreciation.
Capital Account Flow:
Deficit countries need capital flows and surplus countries
generates capital out flow.
India needs dollars to finance its currents accounts deficits.
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5. Fiscal Deficits:
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The fiscal deficits countries to remain high, the
government projected a fiscal deficits target of 4.6% for
2011-12 but is likely to be much higher on account of
higher subsidies.
Interest Rates Difference:
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Higher real interest rates generally attracts foreign
investments due to slowdown in growth there is
interesting pressure on RBI to decrease the policy rate.
Under such condition foreign investors stay away from
investing.
Misuse Of Money & Resources:
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During last two year in India there is increase in number of
scams and money corruption(2G & coal scams).
In fact,2G scams telecom license were cancelled and
foreign investors were informed that India can go back on
policy decision.

6. 
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Price increase of oil, gold and other metals which are
imported.
It makes difficult for the Indian government to reduce
current account deficit since India imports over 80% of its
oil.
Economic growth in India in first quarter (April-June)2013
slipped to 4.4%.
A sharp rise in domestic food price has also put grinding
pressure on the rupee.
Their was low Foreign Direct Investment (FDI) relatively last
one year.

7. 
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64% people reduce investing stock market, stock market
investment giving poor returns.
70.63% of people have started to save their money.
34.13% of respondents have agreed to the fact that they
now have to pay higher EMIs.
57% of people are strongly affected by higher foreign
education cost.
55.56% of people have agreed that foreign traveling
becoming expensive.
Increasing in unemployment rate by 39%.

8. Foreign Direct Investment

9. 
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The duties on the import of Gold, silver, platinum were increase
by 10%.
The FDI limits increased in sectors:
Sectors
74
100
Asset
reconstruction
74
100
Insurance
26
49
Petroleum refining
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Change % Rates
Telecom
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Past % Rates
20
49
New restriction were imposed on Indian resident seeking to send
money abroad to by property.
Put more effort to increase the export give subsidy and provide
more credit limit and liberalized.

10. 
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The interest rate limits for deposit for non resident Indian
were liberalize.
The bank have banned from trading domestic currency
future and the exchange trade option market on their own.
The state own oil marketing companies which by dollars to
finance their imports were ask to trade only with single
state own bank.
On August 28,RBI announce Forex swap window for
OMCs. The OMCs will have to return the dollars to RBI at
the later date. By offering this facility to OMCs, the RBI
took away monthly demand of rupees 9 Bn from the
currency market.
RBI increase the interest rate and liquidity tightening to
booster the rupee.

11. 
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On August 28,Rupee reach new high of Rupee 68.83%
against US dollar.
After introducing new rules & regulations by RBI
On September 19th
On September 20th
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63.38 closing
61.78 closing
This was highest strengthening of rupee 2.54% with in one
day in last two years.
The BSE Sensex raised by 3.43% with in one day.
RBI’s special swaps facilities bring $5.6bn in September.

12. BIG MOVERS in “NIFTY”
Top gainers
Sep 19(rs)
% chg.
YES bank
386.70
22.43
Reliance communication
160.70
12.18
Union bank
139.30
9.86
Punjab national bank
556.80
9.36
Consumption of yellow metal falls 32% in Jully-September.
Demand
2012(tons)
2013(tons)
% growth
Jewellery
136.10
104.70
-23.07
Investment
83.00
43.50
-47.59
Total
219.10
148.20
-32.36
Supply
2012(tons)
2013(tons)
% growth
Net import
Recycled gold
223.00
34.00
85.00
61.00
-61.88
79.41
Other sources
2.00
2.00
0.00
Total
260.00
148.00
-43.08

13. 
Using Forex Reserves:
Period/years
Forex reserves (millions of US $)
2010
304,818
2011
294,398
2012
153,075
2013
145,113
Making investment attractive:
RBI can take step to increase supply foreign currency by
expanding market participation to support Rupee.
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14. 
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Key policy reform that should be initiated include Goods
and Services Tax (GST), Direct Tax Code (DTC), FDI in
aviation and retail sector, companies bills and diesel
decontrol.
Higher custom duties on consumer electronic goods which
are not part of IT as per the agreement of WTO.
India should immediately accept Iran’s offer to sell crude
oil entirely in Rupees at terms & conditions. India could
save Rupees 8.5Bn in foreign exchange.
India could begin trading in local currency with BRICS
partner and Asian countries.
Enter into currency swap agreements.

15. Thank you !