New Delhi: As the rupee keeps falling to new lows, a top government official on Wednesday said it was a temporary phenomenon and the long-term path for rupee-dollar exchange rate was “quite stable”.
He also said the government will soon come out with the list of non-essential imports, which the government had earlier announced would be limited to check rising current account deficit.
“The ten per cent depreciation in last few weeks might have actually shot down our economy a bit. But that’s temporary,” Economic Affairs Secretary Subhash Chandra Garg said at an event here.
“Everybody understands and agrees that that’s a temporary (phase). With such high growth and inflation differential, the long-term path for rupee versus dollar is quite stable,” he said.
Garg was speaking during an economic conclave on “Rural India: Road to $5 trillion economy” organised by the PHD Chamber of Commerce.
He said it was an achievable goal for India to become a five trillion dollar economy by 2025 despite the short-term depreciation in rupee.
“There is always an implication of the dollar-rupee exchange rate. What you measure as five trillion dollars is in dollar terms. So when we appreciate, we become a larger dollar economy and when we depreciate, we become a relatively smaller dollar economy,” he said.
During the discussion, Garg emphasised the need for policy measures for corporatisation of rural economy. He said the government was trying to resolve certain issues associated with the sector and as soon as these were addressed, corporatisation of rural economy could become a reality to spur farm and agriculture income of rural India.
He added that the government was working on a “stable agriculture policy” to transform India’s agriculture economy through which agriculture exports could multiply and reach to $100 billion in near future, a statement said.
Garg said since the dependence of 50 per cent of India’s population was on agriculture, it needed a transition and required policy steps would follow.
Referring to inflationary trends due to depreciating rupee and increasing crude oil prices, he said fiscal target as projected by the government would be achieved.