Assuming that we cannot reduce our imports due to ever raising demand of oil and gold among others and increasing subsidies to retain vote share , what are the implications of devaluing the rupee. How does it effect the common man other than boosting the exports ? Thanks
Most developing and developed countries in Asia have been export powerhouses for long periods in the past.
Most of the major economies in Asia still have a trade surplus.
China has a trade surplus.
Taiwan has a trade surplus.
Singapore has a trade surplus.
South Korea has a trade surplus.
Indonesia has a trade surplus.
Malaysia has a trade surplus.
Thailand has a trade surplus.
Even Japan had a trade surplus till the massive earthquake in 2011 disrupted exports and forced Japan to increase its energy imports.
Hong Kong has a trade deficit, but Hong Kong has an entirely different economic model and is not comparable to other countries in Asia.
Countries like US have less to worry about trade deficits as their currencies are globally accepted.
Things are different for countries like India.
In the long-term, India can either have a stable currency or a large trade deficit. India can't have both.