India’s Problem Is Exports, Not the Rupee
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Aug. 23 (Bloomberg) -- King Canute had it easy. IndianFinance Minister Palaniappan Chidambaram has battled currencymarkets for two months, trying to stem the collapse of theIndian rupee from 55 to a dollar in May to 65 this week. He hasfound commanding currency markets even harder than commandingthe ocean waves.
He should stop trying. A weaker rupee is not inherently aterrible thing. Rather than frantically shoring up the currency,Chidambaram should target the structural impediments in theeconomy that have caused both Indian and foreign investors tolose faith in the once-glowing India story.