While the Indian rupee weakened against the US dollar during 2022, it strengthened against other major currencies such as the British pound, the Japanese yen and the euro. This was stated by Union Finance Minister Shri Pankaj Chaudhary in a written reply. in the Rajya Sabha today.The minister said the main reasons behind the weakening of the Indian rupee against the US dollar are global factors such as the Russia-Ukraine conflict, soaring oil prices and tightening global financial conditions.
The minister further said that the exchange rate is only one of several different factors such as demand for domestic and foreign goods, commodity prices, oil prices, etc., that affect India’s export and import demand. India’s merchandise exports hit a record high of $421.9 billion in 2021-22. India’s exports during each month of the current year were higher than the corresponding months of the previous year. India’s exports and imports in 2021 and 2022 are given in the APPENDIX.
The overall impact of exchange rate depreciation on domestic prices depends on the extent of projection of international commodity prices on the domestic market, the minister said.Elaborating further, the Minister said that the Ministry of Commerce regularly monitors and sensitizes individual Ministries/Departments and other stakeholders on the following broad strategy to address the issue from time to time and in various fora:
Addressing domestic supply inflexibility and pursuing domestic production opportunities/capacity additions;Timely use of trade remedy optionsAdoption of binding technical standards;Enforcement of rules of origin, Tariff measures/correction of reverse duty etc.
In addition, the Minister said, the Department of Commerce is monitoring import data on a monthly and annual basis to identify any visible changes and monitor the increase in imports. All concerned Ministries/Departments are informed about the itemized increase in imports at the level of 8 HS digits on a monthly basis so that appropriate action can be initiated if necessary. A position paper on the import structure is also sent to all concerned ministries/departments every year since 2014, the minister added.Furthermore, the minister said that there is an Import Monitoring System which provides advance information on imports to the government and stakeholdersSteel, Non-ferrous metal ,Coal andChips (integrated circuits).
