1. Rupee Value & Its Impact On
Various Sectors
Team 4
Saiteja
Nagarjuna Adiga
Mohammed Zameer
Nagendra Prasad
Nagarjuna MR

2. Rupee is the Indian Currency

Rupee Value Appreciation

Rupee Value Depreciation

Rupee changes values for a range of reasons, like if US
performs very well then people will demand more US dollars,
exchanging their rupee. This Demand will raise the price of the
US dollar and hence depreciate the Indian Rupee.

3. Reasons for Rupee Depreciation

Basic law of economics

Low forex reserves

Price of crude oil

Performance of dollar with respect to other currencies

Volatility in the equity market

Effects of equity market problems on investors

Poor current account deficit

4. Reasons for Rupee Depreciation …..

Withdrawal of investors

Downgrading of Indian stocks

Condition of import bill

Contraction of Indian economy

Future prospects of INR

5. Infrastructure

6. 
Around 15 per cent of the borrowings of infrastructure
companies have been in dollar terms

Increased the price of construction equipment and building
materials results in enhanced project execution cost.

Increasing costs of inputs like steel and cement are also affecting
infrastructure building.

Fresh investments in infrastructure could also get over priced.

7. 
Construction contractors are heavily dependent on imports for some of
their specialized equipment like high-capacity cranes, automated bar-
bending equipment, and tunnel boring equipment etc.

With many metro rail projects under construction, the cost of these
equipment have gone up by more than 25 per cent purely because of
rupee devaluation.

companies such as JP Associates, NCC, HCC, IRB Infra, and GMR
Infra, that have raised capital through foreign currency loans, will have
to pay higher interest.

These companies have already been hit by the high working capital
requirement and a slowdown in the awards of new projects.

8. Agriculture

9. 
Fall of rupee is not likely to impact the rate of interest as
the farm loans are being given at a low rate of interest

There is Impact on the prices of fertilizers and diesel but it
would be compensated either by the way of subsidy or by
increasing the minimum support price.

Fall in Rupee has led to high food inflation.

10. Here are a few facts on how the rupee could influence
some of the top commodities:
Sugar & Wheat:

A softening rupee will be advantage for exporters from India.

India has a price advantage over supplies from Brazil and Thailand.

India’s decision
to allow one million tonnes of sugar exports will be
advantage.

India is world’s largest producer of wheat.

There’s hardly any impact of the falling rupee on wheat as domestic prices
remain higher than global levels.

With falling global prices, traders believe India may not export wheat at all.

11. Rice & Edible oil

Depreciation in the rupee will lift margins for Indian rice exporters.

The country is aiming for a record 102 million tonnes output against local
demand of about 90 million tonnes

Many exporters have already negotiated their dollar-rupee forward rates,
which means they will not benefit from any change in the rupee valuation

India is the world’s top buyer of edible oil.

imported oils like palm and soy have risen in local markets

Edible oils have 3.04 percent weightage in the inflation index

12. Tourism

Domestic Destinations

Rupee against the dollar

Foreign travel plans

Win-win situation for the country’s tourism sector

India’s popularity as a holiday destination

The tourism industry will grow big time in India

13. Education

The lure of foreign education

Impact of depreciation of rupee

14. Pharmaceuticals sector

Growing domestic pharma market

Half the total revenue is from global market

Larger firms like Glenmark and Ranbaxy to face heat

Increase in the price of imported raw materials and chemicals

15. Real Estate Sector

16. Effects and impacts

increases the project cost and time frame followed by the increased in the
prices of raw material, transportation, wages and salary of labor, engineers,

import of construction equipment etc , outsourced services in form of design
consultancy, architects

Higher Inflation rate and weak economic condition make unfavorable climate
for investor.

Real estate sector is a second largest employment generator after agriculture
as demands of property declining it not only affect economy.

NRI has a advantage to invest in real estate at current point this provide best
option to invest in real estate

17. Manufacturing Sector

Rising import bill

Volatility affecting business

Quoting of prices

Demand for heavy discounts

Overall loss of business confidence

Price hike by manufacturing companies

18. IT Sector

Will push up short term earnings

Hiring and offshore operations cost increase

Depreciation could lead to bargaining

Import of high end equipment end up in more payment

19. Prescription For Ailing Rupee

Issue of Quasi Sovereign bonds

RBI to provide dollars directly to state oil companies

RBI will sell Rs 22000Cr bonds to check liquidity

Hiking the import duty on gold and silver

RBI liberalized bank deposit schemes and some banks raised
rates for overseas Indians

20. Prescription For Ailing Rupee.....

Indian companies have to seek RBI's permission if they want
to invest any amount beyond their net worth abroad

PSU oil companies would be allowed to raise additional funds $4 billion - through external commercial borrowings

21. “We invented money and we use it, yet
we cannot understand its laws or
control its actions. It has a life of its
own”
-Lionel Trilling