How the Indian Rupee Became a Victim of Geopolitical Shifts

According to the 2025–26 Economic Survey, the Indian rupee hit record lows against the US dollar in early 2026, not solely due to domestic factors but significantly influenced by external geopolitical tensions and shifting global capital flows. Heightened risk aversion among foreign investors and India’s exposure to international political volatility contributed to this depreciation. This case highlights how global strategic imbalances can directly affect domestic economic indicators such as currency stability, emphasizing the need for policy frameworks that anticipate geopolitical risk.