The depreciation of the Indian rupee essentially reflects declining confidence in Indian assets. In the short term, rising oil prices worsen India’s current account deficit because the country heavily depends on energy imports. In the long term, however, the bigger issue is that global capital is chasing the AI boom, flowing toward markets that are truly at the center of the AI supply chain — such as the United States, China, Taiwan, and South Korea. While India has advantages in population and software outsourcing, it has failed to secure a core position in this new wave of AI-driven capital expenditure. Unfortunately, India missed the AI bus.
The depreciation of the Indian rupee essentially reflects declining confidence in Indian assets. In the short term, rising oil prices worsen India’s current account deficit because the country heavily depends on energy imports. In the long term, however, the bigger issue is that global capital is chasing the AI boom, flowing toward markets that are truly at the center of the AI supply chain — such as the United States, China, Taiwan, and South Korea. While India has advantages in population and software outsourcing, it has failed to secure a core position in this new wave of AI-driven capital expenditure. Unfortunately, India missed the AI bus.