Raise import duties on select products and countries: Ideally the pathetic economic situation within the country calls for a steep devaluation of the Rupee by 15-20 per cent from the current levels. That implies Rs 75 to a dollar. Remember that we run trade deficits with 80 countries. While some experts have been suggesting a sharp devaluation to revive our manufacturing sector, let us not forget that this idea cuts both ways. While devaluation could make our exports competitive and imports costlier and to that extent offer succour to our manufacturing sector, the fact remains that India being overwhelmingly dependent on crude imports [we import 80 per cent of our total requirements], this idea could backfire. And that could fuel inflation beyond the control of our Government. One way out is to increase customs duties on select products from specific countries to the levels that are permitted by the extant WTO rules. Further if need be, we need to invoke the provisions of the anti-dumping laws and safeguard measures contained in the WTO agreements to combat this surge in our current deficits. In the alternative the Government must explore the possibility of devaluing the Rupee to Rs 70 or even 75 to the Dollar.
Posted on: Fri, 09 Aug 2013 16:14:47 +0000
Trending Topics
Recently Viewed Topics
© 2015