Speaking at the Bloomberg New Economy Forum in New Delhi, Sitharaman said recent actions helped the rupee claw back from sharp losses. She emphasized the central bank's goal is stability, not a peg: "not trying to fix the rupee. They are trying to stop the volatility, and for that there is a lot of effort from RBI side." She added: "These efforts from RBI, I understand, will continue."
She also flagged how currency weakness is affecting flows, noting the depreciation is driving capital out and saying it is "one of the reasons why probably even there's a second thought about should we be here."
Despite repeated RBI interventions in recent months, the rupee has fallen 5.7% so far this year and sits near the bottom of the region's performance tables. Over the weekend, the central bank rolled out a batch of forceful measures to bolster the currency, sparking Monday's biggest jump in six months. But sturdier headwinds remain: India's heavy reliance on imported energy, persistent twin deficits, and choppy capital flows are tougher to neutralize.
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Sitharaman emphasized the government's cautious spending and borrowing have kept the economy on solid ground. She highlighted ease-of-doing-business reforms that have drawn investors seeking to reduce exposure to China. During 2025-26, India's total foreign direct investment climbed to almost $59 billion, an 18% increase from the previous year.
Prime Minister Narendra Modi, hours before her remarks, promoted India as one of the fastest growing major economies and cast the country as a reliable partner in a more uncertain world. New Delhi has been pursuing reforms to draw in more capital, and in August the finance minister embarked on a nine-day visit to Canada and the US, promoting India as an investment destination.
The RBI is actively trying to smooth currency swings, and that push just delivered a meaningful bounce. If you hold assets tied to the rupee or to India-bound capital, expect a tug-of-war between intervention on one side and structural pressures like energy imports and deficits on the other. That mix can influence currency moves and the mood around deploying money into India.
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