Journey of the Rupee; Meandering Through Turbulent Times

The article traces the history of the Indian Rupee till date. It journeys from 6th century BC in circa to present times. The word ‘rupiya' is derived from a Sanskrit word ‘rupyarupa', which means a coin of silver. The concept of the paper is to study how the Indian currency has witnessed a slippery journey since independence .Many geopolitical and economic developments have affected its movement in the last 65 years. The paper also attempts to study the implications of the rupee when after independence it chose to adopt a fixed rate currency regime. In spite of major financial crises and two consequent devaluation of the rupee happened in 1966 and in 1991.Thus, making the government to lift restrictions on its currency. A number of reforms were made on current account transactions (including trade, interest payments and remittance and some capital based transactions) leading to the introduction of partial convertibility of the rupee in 1992. The paper also attempts to high light how a fall in crude prices will immediately have an impact on WPI (wholesale price index) inflation which in turn will have a direct impact on fiscal deficit. This enabled the government to achieve sustainable growth and development .Hence, upgrading the credit rating and image of the country in the eyes of the international communities.