₹$
USD/INR — Sweet Spot for Indian Exports
A clear, actionable summary for policymakers and exporters — simple, colorful, and readable.
Snapshot
1 USD ≈ ₹87.84
(example rate shown for illustration)
Export-friendly nominal band
Recommended: ₹86 – ₹90
Why this band helps (simple)
- Support exporters: A slightly weaker rupee (higher USD/INR) raises rupee revenues for dollar receipts and helps competitiveness.
- Limit inflation: If USD/INR goes too high, import costs (oil, capital goods) push domestic inflation up — hurting consumers and firms.
- Stability > level: Predictability and a competitive REER (real effective rate) matter more than a single nominal number.
Practical trade-offs
- Below ₹86 — cheaper imports, lower inflation, but margins squeezed for price-sensitive exporters.
- Above ₹90 — boosts exporters short-term but risks inflation, higher input costs, and capital outflows.
Recommended policy & business steps
- For policymakers: Manage float to smooth spikes, target REER stability, and use reserves/swaps to prevent disorderly moves.
- For exporters: Hedge FX exposure, diversify markets, and increase value‑addition so you're less dependent on currency moves.
- For both: Complement currency stance with supply-side reforms — logistics, credit to MSMEs, and export facilitation.
Sector notes
Software & services (IT, pharma) are less FX-sensitive than manufacturing MSMEs that rely on imported inputs. Policy should be sector-aware.
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