Indian rupee depreciation to 100 per dollar reflects structural economic fundamentals rather than a crisis. Nilesh Shah, Kotak Mahindra Asset Management MD, argues that gradual currency weakening is necessary for maintaining competitiveness given India's higher inflation and lower productivity versus trading partners. Despite being the fastest growing major economy, orderly depreciation helps adjust the rupee's value in line with macroeconomic realities. Shah notes depreciation pace has moderated from seven percent annually to four percent currently, with potential further slowdown ahead. However, the directional trend toward weakness remains unchanged. Artificially supporting the currency through policy intervention risks capital outflows and economic damage, as seen in other nations.
