Why the Indian Rupee is tumbling?

To get started first we need to check out the Rupee VS Dollar relationship over a period of time. I start from the time of Independence but the crisis of 1991 led to a severe devaluation of money and in 1993 exchange rates were left to be controlled by market sentiments with the central government intervention in case of extreme volatility.

1948-1962 :       4.79 Rupee against a Dollar

1966           :     7.57 Rupee against a Dollar

1975           :     8.39 Rupee against a Dollar

1985           :     12 Rupee against a Dollar

1991           :     17.90 Rupee against a Dollar

1993           :     31.37 Rupee against a Dollar

2000-2010  :      40-50 Rupee against a Dollar

As am writing this, the current exchange rate is 62.13 Rupees against a Dollar while the lowest Rupee-Dollar exchange rate was recorded to be 68.80 Rupees against a Dollar.

Now as you might have noticed on the Indian Rupee note : "I promise to pay the bearer a sum of X Rupees" with the signature of the Governor of R.B.I. This means if by any chance you loose faith in the currency then you can exchange what you have in hand with gold of equal amount. This means for every rupee that enters the economy it is backed by gold of equal amount.

Here the American Dollar comes into picture as Americans were quick to see the potential power of Petrol and its importance at par with gold. Hence they signed an agreement with the Middle East countries that they would offer them protection from external attacks in return of which they will sell petrol only in exchange for American Dollar.

Suppose India wants to buy petrol , so it asks the Middle East countries to supply petrol but they don't recognize the Indian Rupee. Hence India would ask U.S.A. to provide it Dollars in exchange for Rupee. So far so good as long as India buys petrol from the Middle East. But if we don't require that much quantity of petrol and ask America to exchange its dollars , America would simply say that is there anything written on the American Dollar which has been promised. It is simply put is a Debt.

The reality is American white paper is equivalent to a hefty amount of Indian rupee which they can print suiting to their whims.

So whoever is reading this, the one and only panacea to this problem is to increase the production, consumption and dependence on Indian manufactured goods as this would decrease the criminal outflow of Indian Rupee outside as the foreign products we buy at hefty prices are in fact very cheaply produced. Hence , the only way is to increase our dependence in Indian goods, only then can we move ahead in saving our Rupee from tumbling further down and raise it to its former glory.  

Basis of Reservation-Caste or Class?

Well first of all to clear any doubts am not against reservation as a concept but am opposed to the strategy which has been adopted to implement it.

Before going any further let us try to understand the need for reservation.

Reservation is necessary for the upliftment of people who by themselves are not being able to break the shackles of poverty and cannot dare to dream and compete with the people with means and hence denied an opportunity and access to education which is the only way for them to climb out of the rut of vicious cycle they are in.

However our political parties have created such a powerful image in our heads that when it comes to reservation we only are able to think of people from the Scheduled Castes,Schedules Tribes and OBC's living their lives in penury that we seldom question the concept of Caste based Reservation.

It is said that Caste based Reservation is required for giving equal opportunities to the section of people who have been tormented and denied even basic necessities of life owing to the caste they were born into. Ofcourse it is true that for time immemorial people from the 'lower' castes as they call it have been subjected to a life which is hard to imagine for any of us and possibly I can never fully understand the denial, rejection and inhumane behavior they have been put through and possibly even facing today and till now it only seems logical that caste based reservation is what is required to give these people at least a hope to live of as equals.

But this ray of hope is tainted with darkness. Caste based reservation is only proving to be an eyewash since its real beneficiaries are people from upper rung of the ladder of these classes. The real beneficiaries are not people who cannot afford books, healthy environment, good schools and expensive coaching but they are the people who live in sprawling bungalows and apartments, dine at exquisite restaurants, sleep in the comfort of a cozy bed and buy more books than they can possibly read.

So is the situation improving? A clear answer is NO. What was supposed to bridge the gap between years of discrimination is creating yet another class of people. A group of people Have's and another Have Not's within the same castes and the reservation is only being played in the hands of these have's of the so called lower castes.

Yet no political party today can say it will put an end to reservation based on caste as even before it has finished saying so it would have already lost not because the parties and various groups which bank and thrive upon this single divide would bring down the party's offices, tear down their posters, the media would project the party as 'Danger to Democracy' and a 'Threat to the Concept of India' and make the people loose faith in that party but also because we as citizens stay quiet and accept what is happening feeling helpless to bring about any change or even be a part of the change.

But the question is what is the suitable substitute for Caste based Reservation. In my opinion reservation should be based on class rather caste since it takes within its stride people called 'INDIANS' who are struggling to make both ends meet and yet dream a future for themselves and for their children.

Of course am not being naive to imagine an ideal situation where in this basis too people with means would turn out to be the real beneficiaries and that too those people would now run into almost 4 times the number earlier. But now there would be a change in situation. Everybody would try to get reservation (come on even the 'general' class today wants reservation) but not all will succeed and then they would not let people in the same situation as theirs reap the benefits of reservation. A regulatory authority need is indispensable and after some more measures after critically analyzing the situation (that is what the parliament is supposed to do) i believe the real beneficiaries would get their share.

(This is based in the backdrop of the recent drama which took place in the Congress party where after a Congressman advocated for class based reservation , Mrs. Sonia Gandhi quickly retaliated by saying Caste based Reservation is a product of Congress and it would continue to 'CHAMPION' it...God knows what champion it means... )