Shamika Ravi, a member of the Prime Minister Narendra Modi’s Economic Advisory Council, has dismissed concerns over the Indian rupee potentially weakening to 100 against the US dollar.
In an ANI podcast interview, She said, “So what? 100 is just a number.” She added that the focus should not be on defending a particular exchange rate, but on managing the broader economic impact of global supply shocks.
She noted, “At the end of the day, what you do not want is to jump into this, try to keep the value at a certain level, which leads to inflationary pressures, which is going to have all kinds of other chaotic impacts.”
Ravi said “you do not want to intervene in a market which is working fine right now”, arguing that the approach aligns with the emphasis on fiscal discipline and restraining unnecessary consumption.
“Which is why the austerity measures and the other kind of exhortations from the prime minister and now increasingly from different arms of the government, what we do not want is wasteful consumption,” Ravi added.
Ravi acknowledged that prices were likely to increase as the economy adjusted to the shock, arguing that managing demand remains one of the limited tools available in response to a supply-side disruption.
“Our prices will rise because that is the best way to affect demand because this is a shock. You’re not going to be able to do very much,” Ravi said, adding that India had already begun drawing on its foreign exchange reserves.
When asked how long the country could continue relying on those reserves, Ravi responded: “As long as it is required.”
She also expressed confidence that fresh international agreements would help rebuild reserves over time. Citing India’s pact with the UAE, Ravi described it as “a very major agreement” that would strengthen long-term energy security while also bolstering external stability.
‘India in sustained high-growth phase,’ says Ravi
Ravi asserted India’s economy remains on a strong growth trajectory and has shown notable resilience in the face of major global shocks over the past decade.
She attributed this resilience to India’s growth model, which is primarily powered by domestic demand and consumption, helping the country withstand the worst effects of global economic disruptions.
“Indian economy is in a phase of sustained high growth. We are fundamentally a domestic demand-driven economy,” she mentioned.
Ravi pointed out that, unlike export-driven economies such as South Korea, Vietnam, Taiwan and China, India’s growth is largely fueled by domestic consumption and demand. She said this structure has allowed the country to weather external economic shocks more effectively than many of its peers.
“Indian economy is in a phase of sustained high growth. We are fundamentally a domestic demand-driven economy,” she mentioned.
Ravi pointed out that, unlike export-driven economies such as South Korea, Vietnam, Taiwan and China, India’s growth is largely fueled by domestic consumption and demand. She said this structure has allowed the country to weather external economic shocks more effectively than many of its peers.
“In the past also when you’ve had big shocks, it has not translated into big shocks for us, at least in the last 10 years. And that is on account of the fact that your domestic demand works as a bulwark,” she stated.
She also underscored the importance of sound fiscal management in strengthening the resilience. According to Ravi, the government’s emphasis on fiscal discipline has helped preserve stability and avoid sacrificing long-term sustainability for short-term economic gains.