Posted on: 28-11-11 15:51:12
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There are many factors responsible for the devaluation of Indian rupee. But the single most major contributor is the rise in population.
In 1951 it was 361 million, in 1961 it was 440 million, in 1971 it was 540 million, in 1981 it was 684 million and now in 2011 it was 1210 million. I don't know what was that in 1835 where coins were made from only silver.
Rupee was not able to sustain with the haphazard growth of population.
rising population can make a country's economy strong ...
i think u should take example from china they are far better from us...
How are country's currency value and population related ?? Kindly explain ...
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Fido.
Quote:
Originally posted by Fido
How are country's currency value and population related ?? Kindly explain ...
It is very simple. More and more people need more units of currency resulted in continuous supply of currency.
Specifically in India, the land (area)and other resources are less comparable to other countries. so, it did not result in the rise in currency instead it resulted in more supply of currency and hence devaluated.
There are other economic factors like import- export, production etc. are responsible which can lead to rise the currency value but did not sustain against the growth of population and inflation in India.
Of course, this was not the case with China because they have more land (3 times more than India) and population is only 10% more. They did very great to control population in last 30 years since they started liberalization. They have more natural resources and utilized very well so they are way ahead in GDP than India so they have a good track record about the value of currency. This is not the case with India.
Hi ashedfc Thanks I Agree with you.. I think India is all set to be 1st BIG Economy to enter Hyperinflation ..
Check this .. http://www.commonmaneconomics.com/2010/10/billionaire-beggars.html
