In an exclusive interview with India Today TV, former Reserve Bank of India Governor Raghuram Rajan shares his thoughts on how to deal with the ongoing conflict in West Asia’s impact on the global and Indian economies and more.
On rupee’s depreciation, Raghuram Rajan said, “Steady adjustment is okay. A freefall is not. With our current account deficit larger but more important, the fact that capital is not coming into India to the extent that we need to finance our deficit. The rupee adjustment, some of it is, is necessary. What you don’t want is a situation where the rupee falls because people think it’s going to fall, and you’ve got a lot of investors abandoning rupee assets because they fear a further fall in the rupee.”