Unsuccessful Merger and Acquisitions in India

Index

1. Brief introduction

2. Factors affecting INR

3. Major crisis related to INR

4. Liberalization in 1991 and its impact on INR

5. Exchange rate policy of India

6. Rupee movement graphs after independence

7. Rupee depreciation and its impact

8. Outlook on INR.

Brief Introduction

The persistent decline in the value of INR is of great concern to the nation. Even if now that we are in the stage of reform we need to strengthen INR against major currencies of the world. The following report is a brief analysis of the possible causes of currency depreciation, its impact and the current outlook of INR. For last few years for reasons like withdrawal of FIIs, widening current deficits, decline in other capital flows like FDI, ECBs, and FCCBs. Along with these factors the report also emphasizes on major crisis in the history of India related to the INR. Exchange rate policy is also one of the greatest determinants of the INR depreciation. These movements are shown by graphs and data of REER, NEER and BOP. Also it discusses about how can the depreciation of the currency can be used to draw advantage.

The recent reforms like rate hike of diesel and allowing 100% FDI in retail and aviation have shown a good appreciation in the currency but still the political instability and the uncertain climate about the coalition govt is posing hurdles.

Factors affecting INR

In the following section we are discussing the factors which are affecting the currency. There can be many reasons for the depreciation of the currency, but we need to categorise them into various headings. Further it is being discussed in detail with the help of data extracted from the various sources ranging from RBI, SEBI etc.

The factors affecting INR:

I. Market Situation

II. Economic Factors

III. Political factors

IV. Special Factors

As we know that Forex market for Indian currency is highly volatile where one cannot forecast exchange rate easily,...