Lok Sabha Question No. 3847 (UNSTARRED), answered on 2026-03-16
Subject: Depreciation of Indian Rupee against US Dollar
Ministry: FINANCE
Asked by: Shri Kalyan Banerjee

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 3847

TO BE ANSWERED ON 16.03.2026

## DEPRECIATION OF INDIAN RUPEE AGAINST US DOLLAR

## 3847. Shri Kalyan Banerjee:

Will the Minister of Finance be pleased to state:

- (a) whether it is a fact that the Indian rupee has depreciated against the US dollar by about 6.5 % between April  1,  2025  and  January  22,  2026  making  it  among  the  weakest-performing currencies during the period, if so, the details thereof;
- (b) the reasons for the inability of the Government to arrest the decline in the Indian currency against the US dollar;
- (c) the details of US dollar and other foreign currency reserves liquidated during the last three years to stabilise the Indian rupee against the US dollar;
- (d) whether the Government is concerned the Indian rupee slipped past the Rs. 90-mark against the  US  dollar  while  many Asian  countries  demonstrated  higher  resilience  or  strengthened currency during the same period, if so, the details thereof;
- (e) the exchange rate between the rupee and the US dollar in the year 2014 and the present exchange rate in 2026; and
- (f) the steps taken by the Government to prevent depreciation of rupee since 2020?

## ANSWER

THE MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHARY)

- (a)       The Indian rupee (INR) has depreciated by 6.7 per cent against the US dollar (USD) between April 1, 2025 and January 22, 2026. The appreciation/depreciation of other major currencies for the same period is presented in the table below.

| Currency          |   Appreciation (+) / Depreciation (-) %against USD |
|-------------------|----------------------------------------------------|
| Euro              |                                                8.7 |
| Yen               |                                               -5.3 |
| British Pound     |                                                4.5 |
| Chinese Renminbi  |                                                4.1 |
| Indonesian Rupiah |                                               -1.9 |
| Philippine Peso   |                                               -3.3 |
| Brazilian Real    |                                                7.9 |
| Korean Won        |                                                0.5 |
| Turkish Lira      |                                              -12.3 |

Source: Bloomberg

(b), (c) & (d) Various domestic and global factors influence the exchange rate of the INR, such as the movement of the Dollar Index, trend in capital flows, level of interest rates, movement in  crude  prices,  current  account  deficit  etc.  During  the  current  financial  year  2025-26,  the depreciation of the INR has been influenced by the increase in trade deficit, amid relatively weak support from the capital account.

The  value  of  the  INR  is  market-determined,  with  no  target  or  specific  level  or  band.  The Reserve Bank of India (RBI) regularly monitors the foreign exchange market and intervenes in situations of excess volatility. The details of RBI's foreign exchange market interventions in the last three years have been given below:

|   Calendar Year | Net purchase (+)/sale (-) of US dollar (in million)   |
|-----------------|-------------------------------------------------------|
|            2023 | 18,135                                                |
|            2024 | -12,350                                               |
|            2025 | -51,714                                               |

Source: DBIE, RBI

- (e)              The  exchange  rate  of  INR  against  USD  at  the  end  of  calendar  year  2014  was ₹63.04/USD, while that as on March 11, 2026, was ₹92.04/USD.
- (f)       The RBI monitors key developments across the globe which may have an impact on the USD-INR exchange rate.  Among  others,  it  includes  monetary  policy  actions  of  the  major Central  Banks,  major  economic  data  releases  across  the  globe  and  their  impacts  thereof, OPEC+ meeting decisions, tracking, and analysing geo-political events, daily movements in G-10 and EME currencies etc. The RBI has taken several measures since 2020 to diversify and expand the sources of forex funding to mitigate volatility in the exchange rate. These measures, inter alia , include:
-  In  February  2026,  the  revised  External  Commercial  Borrowings  framework  was introduced in terms of which the eligibility norms were simplified, the minimum average maturity  period  was  standardized,  end  use  provisions  were  eased  and  operational flexibility was enhanced (including interest rates).
-  In August  2025,  persons  resident  outside  India  that  maintain  a  Special  Rupee  V ostro Account for international  trade  settlement  in  INR  were  permitted  to  invest  their  rupee surplus balance in the aforesaid accounts in Central Government Securities (including TBills).
-  In May 2025, the requirement on Foreign Portfolio Investors (FPIs) to comply with the short-term investment limit and concentration limit for their investments in corporate debt securities was withdrawn.
-  With effect from January 2025, persons resident outside India, having a business interest in India, were allowed to open a Special Non-Resident Rupee Account with an authorised dealer in India or its branch outside India to facilitate cross-border payments.
-  The  ceiling  rate  for  Foreign  Currency  Non-Resident  (Bank)  (FCNR(B))  deposits  was raised on December 6, 2024, allowing banks to offer higher interest rates on such deposits mobilised till March 31, 2025.
-  An operational framework for the reclassification of foreign portfolio investment by FPI to FDI, upon breach of the stipulated limits, was released in November 2024.
-  Authorized dealers in India were permitted to allow persons resident outside India to open, hold and maintain an interest-bearing account in Indian Rupees and/or foreign currency for  the  purpose  of  posting  and  collecting  margin  in  India,  for  a  permitted  derivative contract entered into by such persons in terms of Foreign Exchange Management (Margin for Derivative Contracts) Regulations in May 2024.
-  Incremental FCNR(B) and Non-Resident (External) Rupee (NRE) deposit liabilities were exempt from the maintenance of CRR and SLR for deposits mobilised up to November 4, 2022. Fresh FCNR(B) and NRE deposits were exempted from the extant regulation on interest  rates  (interest  rates  shall  not  be  higher  than  those  offered  by  the  banks  on comparable domestic rupee term deposits) till October 31, 2022. Further, the regulatory regime relating to FPI investment in debt flows has been revised to encourage foreign investment in Indian debt instruments. The External Commercial Borrowing limit (under automatic route) was raised to $1.5 bn, and the all-in-cost ceiling was raised by 100 bps in select cases up to December 31, 2022. Authorised Dealer (AD) Category-I banks could utilise  overseas  foreign  currency  borrowing  for  lending  in  foreign  currency  to  end-use prescriptions as applicable to external commercial borrowings.