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Challenge to Indian outsourcing - Indian Rupee moving higher – much higher against US Dollar
Indian Rupee is moving higher against US Dollar. The plan is to provide a level plain field for US corporations compared to Indian companies. The Reserve Bank of India is going to allow the rise of Indian Rupee. It is now called a silent revaluation with calling it a revaluation. Bush Administration wants a two way trade with India and China. Both Chinese and Indian currencies are on their way up.
This is the real challenge for “easy money making” Indian software oligarchs. Can the call centers and IT companies survive? Experts say, the Indian IT companies and call centers for the first time will learn to compete in fair play ground and those who are really efficient will survive. Most of Indian IT and Call center companies survive by unfairly taking advantage of artificial currency differential between US Dollar and Indian Rupees. That is what is going to come to an end.
According to media reports, the Rupee on Friday rallied smartly against the US currency due to strong exporter dollar sales and unwinding of long dollar positions by banks ahead of the extended holiday weekend even as the interbank foreign exchange (forex) market braced up to the soaring oil prices.
Closing at Rs 43.53/54 per dollar, a sharp 6-1/4 paise rise from Thursday over one month closing lows of Rs 43.5925/6000, the Rupee traded in a fairly broad range of Rs 43.53 and Rs 43.60 following a positive opening slot of Rs 43.5750/5850 per dollar.
Despite a sustained surge in global crude oil prices to record peaks of over 66 dollars a barrel, the Rupee rebounded smartly on the back of robust exporter dollar sales, a lingering weak dollar overseas and offloading of dollar position ahead of the long holiday weekend, dealers said.
The forex market will remain closed on Monday, August 15 on account of the Independence Day.
Oil prices continued a relentless rise above 66 dollars a barrel in Asian trading on Friday as the global appetite showed no signs of waning and US refineries struggled to keep pace with demand.
New York's main contract, light sweet crude for September delivery struck a new high of 66.11 dollars a barrel.
"Most players unwound long dollar positions in the closing minutes of the trade, as they did not want to keep huge dollar positions ahead of the long holiday weekend amid the high carryover charges," a forex dealer said.
OUTSOURCING ARTICLES
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