Is the decline of US dollar beneficial from Indian point of view?

Question

what are the general consequences

Answer 1

Low $ - means low Indices

Indian market  does not depend on these indices but psychologicaly investores in India are over causious and behave to these indices.

result

No benefits

benifits only for exporting companies and visitors

Answer 2

Companies who export their business services to largely US based clients will benefit a lot from the declining rupee.

Conversely with the rupee appreciating and the dollar depreciating, the operational margins of these companies will be hit very hardly.

IT companies are the significant lot to be affected by this movement.

Answer 3

That actually depends on what exactly one is doing in India.... It may be benificial to some but may not be to others. The decline of US dollar, in simple means the fall in the value of the dollar against the rupee. Consider these two situations: An india wants to import some raw materials/machinary from US. This scenario is ideal for him because he will have to shell out lesser rupees equivalent to the dollar, right? He is at an advantage....

Now consider an indian who exports his goods, say sugar/tea, to the US. His earnings will be reduced as he will get fewer rupees for the same dollar!! For him it is an disadvantage. Similar will be the disadvantage for IT companies who sell software to US or any other country but get paid in dollars....

Than there is also the matter of FOREX reserve that the RBI/Indian Govt holds with it! The billions of US dollars will fall in value in the international market, which means that we will have to shell out more for our trade deficits!!

So the fall in dollar is not really ideal for all!! It may be for a small group, but when we see at the global economic scenario, the more consistant the dollar the better it is!

Its a very complicated question actually....

Hope you are satisfied with the answer.....          :)

Answer 4

You will get a clear-cut answer if you hear the lecture of an Economist using the following link:

http://video.google.com/videoplay?docid=...

Answer 5

Well you can see what happened to the price of oil, and that is hurting the whole world

Answer 6

No, makes all indian goods, including personnel, more expensive.  tba