We may be staring at nothing less than the perpetual and progressive impoverishment of our people if we don’t extricate ourselves from these traps. To escape these traps, we need to face up to the multiple challenges they pose. Most of them go well beyond monetary policy and the narrow remit of central banks. Some intensive soul-searching is called for.
Is it healthy for many of us to continue to worship at the altar of a weak rupee? Should we saddle our poorer compatriots with the additional burden of paying for currency depreciation? A sliding rupee will push up prices in our import-dependent economy, reduce disposable incomes of consumers, and result in a net transfer of national wealth to richer exporters.