India’s loss of its ‘trillion-dollar’ status is a setback to the India-has-arrived cheerleaders. So utterly devastated have they been by this loss that there are dark suggestions that a ‘foreign hand’ is responsible for this denouement. True to form, the media are agog as to the identity of this party pooper who has halted India’s march to superpowerdom. China’s economy hit the $1 trillion mark in 1998. Brazil followed in 2006. Then came Russia’s turn. India reached this milestone in April 2008. But, alas, it’s not in the ‘T’ Club any more.
Subsequent investigations indicated that this ‘foreign hand’ was none other than the mysterious, wayward exchange rate of the rupee. The country’s passage into the ‘T’ Club was initially fast-forwarded by the relentless rise of the rupee against the US dollar. This currency unit hit a nine-year high of Rs 41 to a dollar that translated
India’s GDP into a trillion dollars in 2006-07. Its subsequent weakening against the greenback ensured that India is no more a trillion dollar baby in 2007-08.
As if all of this weren’t terrible enough, India’s stock market capitalisation has been deprived of its trillion-dollar status even faster. It was $1.02 trillion on June 30 and calamitously dropped to $970 billion the very next day. The cheerleaders, thus, have been hit with a double whammy and are now more convinced than ever of the cruel ways of the ‘foreign hand’ in sabotaging India’s prospects as a BRIC superpower.