The share of crude oil in India’s import bill rose from 11 per cent in 1972–73 to 26 per cent by 1974–75. As exports improved, particularly to oil producing Middle-East countries, BoP recovered quickly from the first oil shock.
By this time, the Indian rupee, which was linked to a multi-currency basket with pound sterling as intervention currency, depreciated against the US dollar (Chart 2). 3  Comprises services, transfers and income. BIS central bankers’ speeches  3  Depreciating rupee along with other policy incentives to exporters acted as a supporting factor for India’s exports.