Abstract
The appreciation in the real value of the rupee would bring down export growth rate to less than 6 per cent for 1996–97 and unless corrected would lower the growth rate of the economy. Today, the economy is ideally situated to grow at rates in excess of 9 per cent if a sharp depreciation of the rupee can be brought about. Such growth would be sustainable. That the state has not pursued growth maximizing policies via exports growth is due to the limitations that the rentier classes impose, and to its adherence to monetarist ideology. Achieving convertibility on capital account would be too premature for an economy which is yet to achieve its industrial transformation.
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