Why is India's currency on the slide?

New low against the dollar today.

The Indian rupee crashed to a new low against the US dollar today as foreign investors continued to pull their money out of the country. Following a slump of 3 per cent today, the rupee has now depreciated by 24 per cent this year from 55 per dollar at the end of 2012 to 68 per dollar currently.

According to Timetric wealth analyst Shekhar Tripathi the depreciation is being caused by a number of factors. These include rising oil prices and a high current account deficit. He stated "the price of crude puts tremendous stress on the Indian Rupee as India has to import the bulk of its oil requirements in order to satisfy local demand."

A lack of government reform has also been highlighted as a contributing factor as the Indian government could have introduced far more reforms during the boom years between 2003 and 2008. Instead they failed to sufficiently build infrastructure or liberalize markets for labour, energy and land during this period and now it is far more difficult to source investment for this.

According to Progressive Media analyst Sunil Agarwal "the lack of economic reform and political paralysis was a major cause of the recent depreciation with the Reserve Bank of India sending out mixed signals on monetary policy".

He also pointed to the recent recovery in the US which has encouraged US investors to pull their money out of emerging markets and invest more money onshore.

India’s problems are not limited to the recent depreciation. Despite relatively strong growth over the past decade India remains one of the poorest countries in the world with the bulk of the population still living below the poverty line.

According to the latest Credit Suisse Wealth Book India’s wealth per capita amounted to US$2,560 per person at the end of 2012 which is well below the worldwide average of US$31,500. It also compares poorly to other major emerging markets such as China (US$15,000) and Brazil (US$16,500) and perhaps most alarming it is well below the fast growing Indonesia (US$7,100).

The Indian rupee crashed to a new low against the US dollar today. Photograph: Getty Images

Andrew Amoils is a writer for WealthInsight

Getty
Show Hide image

Harriet Harman warns that the Brexit debate has been dominated by men

The former deputy leader hit out at the marginalisation of women's voices in the EU referendum campaign.

The EU referendum campaign has been dominated by men, Labour’s former deputy leader Harriet Harman warns today. The veteran MP, who was acting Labour leader between May and September last year, said that the absence of female voices in the debate has meant that arguments about the ramifications of Brexit for British women have not been heard.

Harman has written to Sharon White, the Chief of Executive of Ofcom, expressing her “serious concern that the referendum campaign has to date been dominated by men.” She says: “Half the population of this country are women and our membership of the EU is important to women’s lives. Yet men are – as usual – pushing women out.”

Research by Labour has revealed that since the start of this year, just 10 women politicians have appeared on the BBC’s Today programme to discuss the referendum, compared to 48 men. On BBC Breakfast over the same time period, there have been 12 male politicians interviewed on the subject compared to only 2 women. On ITV’s Good Morning Britain, 18 men and 6 women have talked about the referendum.

In her letter, Harman says that the dearth of women “fails to reflect the breadth of voices involved with the campaign and as a consequence, a narrow range [of] issues ends up being discussed, leaving many women feeling shut out of the national debate.”

Harman calls on Ofcom “to do what it can amongst broadcasters to help ensure women are properly represented on broadcast media and that serious issues affecting female voters are given adequate media coverage.” 

She says: "women are being excluded and the debate narrowed.  The broadcasters have to keep a balance between those who want remain and those who want to leave. They should have a balance between men and women." 

A report published by Loughborough University yesterday found that women have been “significantly marginalised” in reporting of the referendum, with just 16 per cent of TV appearances on the subject being by women. Additionally, none of the ten individuals who have received the most press coverage on the topic is a woman.

Harman's intervention comes amidst increasing concerns that many if not all of the new “metro mayors” elected from next year will be men. Despite Greater Manchester having an equal number of male and female Labour MPs, the current candidates for the Labour nomination for the new Manchester mayoralty are all men. Luciana Berger, the Shadow Minister for mental health, is reportedly considering running to be Labour’s candidate for mayor of the Liverpool city region, but will face strong competition from incumbent mayor Joe Anderson and fellow MP Steve Rotheram.

Last week, Harriet Harman tweeted her hope that some of the new mayors would be women.  

Henry Zeffman writes about politics and is the winner of the Anthony Howard Award 2015.