Falling exchange rate can curb imports more effectively than austerity measures. Don't intervene in forex market
India faces a familiar policy conundrum. A sharp rise in global prices of oil, gas, and fertilisers, triggered by conflict in West Asia, is weighing on growth while putting pressure on the rupee. To reduce the import bill and conserve foreign exchange, PM Modi has called on citizens to adopt voluntary austerity: commute less, work from home where possible, rely on public transport and carpooling, defer overseas travel, curb gold purchases, and prioritise domestically produced goods.