How did RBI help India surpass Japan to become 4th largest economy in the world?
How did RBI help India surpass Japan to become 4th largest economy in the world?
A while back, it was predicted that India would take some time to surpass Japan, but what happened that we quickly became the 4th largest economy? Well, in the current global scenario where the dollar is the dominant currency, when calculating GDP, there’s a conversion from rupees to dollars, which can introduce errors unnoticed by many. For instance, if my GDP is one crore rupees and the exchange rate is eighty rupees per dollar, my GDP in dollars would be one lakh twenty-five thousand. But if the rupee falls to ninety per dollar and my production remains the same, my GDP in dollars would decrease to one lakh eleven thousand one hundred eleven, even though my GDP hasn’t actually declined, only the currency value has. Japan has been struggling to stabilize its currency amid global economic issues, but the RBI has managed to stabilize the Indian rupee, contributing to this achievement, credit for which should go to both the government and the RBI.
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1 Comment
So a history graduate is much better in handling our economy than a renowned economist like Raghuram rajan who almost destroyed our economy during UPA era