The depreciation of Indian rupee against the US dollar is expected to push the country's import bill by about $15 billion, think tank GTRI said on Thursday.
Compared to December last year, the Indian Rupee (INR) has depreciated 2.34 per cent against the US dollar, moving from Rs 83.25 to Rs 85.20, while the Chinese Yuan has weakened by 0.06 per cent, the Global Trade Research Initiative (GTRI) said.
It added that this depreciation of the INR will negatively impact gold imports, especially as gold prices have surged 27 per cent from $2,066.26 per ounce in December 2023 to $2,617.11 per ounce in December 2024.
India's oil imports, mostly priced in USD, could have been significantly costlier due to the rupee's depreciation, however, the impact has been mitigated by a 5 per cent drop in Brent crude prices, from $77.6 per barrel in December 2023 to $73.7 per barrel in December 2024, it said.
"Overall India's import bill will increase by about $15 billion due to the INR depreciation impact," GTRI Founder Ajay Srivastava said, adding that the most significant effect of the INR's depreciation will be on India's $100-billion worth of industrial goods imports from China.
Since both the INR and the yuan have weakened against the US dollar, the dual depreciation amplifies the cost of these imports, further straining trade balances, he said.
