Rupee fall was long overdue: Panagariya

Former Niti Aayog vicechairman Arvind Panagariya has opined that rupee depreciation was long overdue, saying appreciated currency had hurt the country's exports.

Panagariya further said India's macroeconomic management is sound and there was no reason to worry.

"The main news recently in the macro story is depreciation of the rupee. But this had been long overdue.

"The real exchange rate has seen large appreciation in recent years and this has hurt our exports," he said.

The rupee on August 16 slumped to a life-time low of 70.32 to the US dollar on strong demand for the greenback.

The rupee on Friday staged a good recovery to end higher by 20 paise at 69.91 against the US currency.

Panagariya who is currently a professor of economics at Columbia University further said, "I am personally very pleased the RBI has used our foreign exchange reserves prudently in managing the exchange rate."

Replying to a question, the former Niti Aayog vice chairman said that he expects India's growth rate to cross the 8 per cent mark by the third or fourth quarter of fiscal 2018-19.

"I am confident that in less than ten years we will cross the UK, Germany and Japan to become the third largest economy in the world," he predicted.

On the possibilities of populist measures being announced by the Modi government ahead of 2019 general elections, Panagariya said that the risk is omnipresent "but I do not see this happening."