Effects - if Rupee is equal to Dollar
India is the major exporter of goods and services throughout the world. The reason for exports to, say for example to USA is because of currency difference since exporting goods generate huge amount of Foreign Reserves. A review to draw a comparison if both Rupee and the Dollar are kept at the same level shall reflect the following effects - 1. Decline in Exports - If one consignment of shoes to be exported costs Rs.10,000/- which is equal to 10,000 Dollars, then why would anybody will like to send it? Because earnings will remain same. Moreover, it will discourage exporters' community as well Such activity have some dangers and harms also. Currency fluctuates mainly with different economic cycles, purchasing power and market forces besides other factors. Not exporting will mean no dollars in India which will effect international payments capacity, contingencies or unexpected capital ...