Is India an upside down country?

From a constant discussion of whether interest rates should be, would be, could be reduced by the Reserve Bank and by how much newspapers have suddenly woken up to the dangers of inflation and the falling rupee. The rupee has fallen 8% since 1 May 2013. A 10% fall of the rupee increases inflation by 1% and a Re 1 rise in value against the dollar raises the oil import bill by Rs 80 billion. The fall in the value of the rupee is due to 1. An unsustainable Current Account Deficit, 2. Persistently high inflation for several years, 3. A slowdown in growth of total factor productivity and 4. Fears about reversal of capital inflows. Other currencies also in trouble are the Brazilian real, Turkish lira and the South African rand, all because of high CAD. Livemint, 10 June. Massive trade deficits show that India has lost competitiveness because 1. High inflation has pushed up costs of goods manufactured in India, 2. The slowdown in productivity growth means that companies cannot overcome higher costs by increased efficiency and 3. Very poor infrastructure and a deterioration of business climate in the last few years. This is because of enormous corruption and rent seeking by politicians but the first 2 problems can be reduced by a devaluation of the rupee by making exports cheaper. This apparently is the classic response of an economy that has lost competitiveness. Trouble is that India is imports more than it exports and a fall in the rupee will increase prices of imports, such as oil, natural gas, coal and gold, and add to inflation. When countries want to control inflation they increase interest rates but the RBI has cut interest rates by 75 basis points since 1 January. Falling interest earnings with rising prices are lethal for people who depend on savings for survival, such as pensioners. Australia recently cut interest rate to weaken the Aussie dollar because it was hurting exports. China buys huge quantities of dollars to weaken its currency and increase exports. Yet Indranil Sen, India Economist at DSP Merrill Lynch said," In our view the rupee will continue trade weak till the RBI is able to recoup $60 billion of FX ( including forwards ) sold since 2008. Keeping rates high will only defer recovery, deter FII equity inflows and delay re-accumulation of FX reserves." In other words he is advising exactly the opposite of what other countries would do to control inflation and strengthen the currency, which is raise interest rates and sell dollars. Yesterday the RBI sold dollars to support the rupee. Trouble is we only have about $250 of reserves, enough for 6 months of imports. Why the opposite advice? Is India an upside down country?