“Rupee hits low against dollar”, “Rupee falls 51 paise against USD” “Rupee slowsdown; drops ` 65.24 (on Aug 27) to USD” -
You must have come across these headlines in last few days. But why does it happen? Bhavya Rathi will solve your queries...
All the above headlines are being generated because the Indian currency has hit a major low (in last 10 years) against the ever affulent dollar. But this pops a question in my mind- How is the drop in Indian currency related to US dollar? Well, here is a simpliﬁ ed meaning for you.
What is falling of Rupee?
It simply means that we have to spend more Rupees inorder to trade with US or any other country who deals in US dollars. 1 USD = `66 Hence, if you want to have a burger in US, there you just have to pay $1, but on the contrary if you will calculate it in Indian currency that will cost you `66 for now!
Why does the Rupee fall?
There are two kinds of countries - developed and developing. US is a developed country and India is a developing country. The development of a country depends upon the rate of poverty, infrastucture, amount of imports and exports and lifestyle of its citizens etc. The falling of a rupee is majorly caused by the excessive use of imported goods. Hence, while trading with a developed country and importing its goods, a developing country has to follow some norms and keep a balance of the import and export conditions.
How is India affected?
* India being a developing country, rely heavily on imports of crude oil, edible oil, gold, food and drugs.
* Secondly, we import more and export less. All these reasons create imbalance in the economy.
* Due to rise in price, the poor cannot afford a proper lifestyle which leads to poverty, diseases and malnutrition.
Let us solve an activityMeera visits USA. She ﬁ nds that she skipped to pack some commodities, so she visits a supermarket to buy them. The cashier gives her a bill containing
Soap - $2
Shampoo - $3
Chocolate - $1
Bag - $4
The rate of rupee against 1 dollar is ` 66. So can you tell us how much Meera has spent in Indian currency?
What’s getting costlier?
3- Crude oil & edible oil
6- Foreign education & trips
7- Foreign loans for companies
How can your family help?
Please spare a few minutes here for the sake of your country.
*Purchase less imported products.
*Buy less gold, as we import it
*Buy products of Indian companies. Every Indian product you are buying makes a difference to our economy. The goverments roleGovernment needs to levy the tax on foreign products, and its already doing it. It has already increased import duty on gold, as Indians are fond of buying gold as an asset.
* US dollar ($) is the currency of The United States of America. Though, dollars are also used in Australia, Singapore etc. But they are termed as Australian dollars or Singapore dollars.
* Euro is the currency of 17 out of 28 European countries. A few of them are France, Greece, Germany, Italy &
* 1 Euro (€) = ` 87.37
* Pound is a British currency and is used in United Kingdom.