Manufacturing Growth Key to Stronger Rupee, Services Exports Play Secondary Role: CEA in Economic Survey
Manufacturing growth, not services exports alone, will drive long-term rupee strength, Chief Economic Adviser V Anantha Nageswaran said during the Economic Survey briefing.
Chief Economic Adviser V Anantha Nageswaran, speaking at the Economic Survey 2026 press briefing, said that depreciation of currencies is a common feature across emerging market economies and is not specific to India. He said the rupee’s movement tracks what has happened to many other emerging market currencies over long periods and in recent months. In his view,...
Chief Economic Adviser V Anantha Nageswaran, speaking at the Economic Survey 2026 press briefing, said that depreciation of currencies is a common feature across emerging market economies and is not specific to India.
He said the rupee’s movement tracks what has happened to many other emerging market currencies over long periods and in recent months. In his view, global financial conditions and investor risk appetite shape these moves more than any single domestic headline.
The comment comes as the Economic Survey 2025–26 flags a gap between India’s macro fundamentals and the rupee’s performance. The Survey describes the rupee as “punching below its weight” and points to global uncertainty and cautious foreign investors as key reasons for weaker currency outcomes even when domestic indicators look steady.
Nageswaran said a stronger rupee over time depends on building manufacturing strength. He tied this to the experience of economies that industrialised at scale. In those cases, manufacturing-led export growth came first. Better current account outcomes and higher foreign exchange reserves followed. That mix then improved currency credibility.
He also drew a clear line on services. Nageswaran said services exports matter for India. He also said services work best as a complement to manufacturing, not a replacement for it. The point is that services alone do not create the same export engine that large-scale manufacturing can build, especially in goods trade where volumes and supply chains drive sustained foreign exchange earnings.
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The broader Survey narrative supports this push. It stresses that India must treat manufacturing capacity as a strategic asset, with innovation and scale as central goals.
If India wants a rupee that carries more weight in global trade and finance, it must raise manufacturing competitiveness, expand goods exports, and strengthen the external balance. The Survey frames the rupee’s path as part of that larger structural story, not as a short-term currency chart problem.
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