Thaindian News

New Delhi, Nov 22 (IANS) With the Indian rupee sliding to a record low of 52.73 against the US dollar Tuesday, Commerce Secretary Rahul Khullar said there was no need to overreact to the weakening as it was driven by global factors and would benefit exporters.

“We should not overreact to movements in the exchange rate. But, also understand that there are good reasons for what is happening,” Khullar told reporters here while reacting to the sharp drop in the value of Indian rupee in the recent days.

Rupee touched a record low of 52.73 against the US dollar Tuesday morning as importers, especially oil refiners, scrambled to buy the greenback in view of the swelling current account deficit and stubbornly high inflation.

Khullar said the Indian currency has weakened due to uncertainties in global economies and several other factors.

“Expectations of economic events in certain parts of the developed world together with asset preferences are driving investors into taking decisions which affect not only exchange rates but the prices of commodities,” Khullar said.

The Indian currency has weakened by almost 16 percent in the last four months.

Weakening in the currency makes imports costlier, while it would boost exports.

Earlier, addressing a conference here, Khullar said India’s exports was likely to surpass the government’s target of $300 billion in the current fiscal.

“Exports during the current fiscal are expected to surpass $300 billion as during the first eight months of the current financial year the total exports have reached $231 billion,” he said.

Khullar said the commerce ministry had prepared a strategy paper envisaging doubling of exports to $500 billion by 2014.

“As part of government’s newer strategy to double over all exports by 2014, a special focus has been given on employment intensive sector agri-exports for which the export target has been set at $22 billion,” he said.