Steps to Check Sliding Rupee, Rising Inflation
The AIADMK manifesto released on Tuesday promised to check depreciation of rupee and ensure that the country’s economy is insulated from shocks.
Underscoring the importance of maintaining the value of the Indian rupee without volatile fluctuation, the manifesto said necessary measures would be taken in this direction. “The value of the Indian rupee is vulnerable to volatile fluctuations because of large volumes of short term capital inflows and outflows both in the stock markets and debt markets,” it said and added that short term capital flows would not be encouraged and only long term foreign direct investment would be given importance.
Speculative trading in currency derivatives would also be eliminated, it asserted. Steps would be taken to control consumer prices inflation and food inflation by taking action to bring down input costs.
While foreign trade is important to earn foreign exchange, opportunities must be given to domestic enterprises to grow into large entities, the manifesto said, adding, “when there is no protection for domestic production and goods and the emphasis is on imports, domestic, agricultural and industrial production is affected, resulting in people being employed in such industries losing their jobs.” The AIADMK will take necessary action to implement such a policy, it said.
The AIADMK is also of the firm view that the 14th Finance Commission should be allowed to make its recommendations independently without being influenced by the recommendations of the Raghuram Rajan Committee, particularly with reference to resource allocation based on the index of underdevelopment, the manifesto said and added that steps would be taken to improve State finances.
The manifesto said steps to promote domestic manufacturing and production would be taken so that such steps would not only fulfil the domestic needs but can also be exported to other countries.
The AIADMK would adopt such a policy where imports would be limited only to those essential goods of which there is a shortage in the country. If such a policy is adopted, it will reduce the Current Account Deficit and enable faster economic development of the country.