Should the rupee fly high, or slightly lower?

Like our flag the rupee is a symbol of our nation of India. We are proud to see our flag flying high, at the top of the mast, so should the rupee be flying high as well? Unfortunately, the answer is not so simple. A strong rupee brings down the cost of imports, such as oil, resulting in lower prices and increased buying power for the people. On the other hand a strong rupee could make gold seem cheaper, as it is priced in dollars, reduces foreign earnings of companies, because of reduced exchange rates, and hurts exports by making them more expensive. Exports are down because of the weakness of the global economy. By encouraging imports while reducing exports a strong rupee will increase our Current Account Deficit, which is money flowing out of the country. One way would be to increase taxes on imports to make them so expensive that people are forced to buy Indian products. India is one of 23 countries founding members of GATT, which later became the WTO. Yet other members of the WTO are complaining about the high rates of taxes on imports. Our companies put pressure on politicians to keep taxes high so that they can sell shoddy products to citizens at inflated prices, without being restrained by competition. Although companies are reporting lower earnings growth, net profits have grown at almost double the rate of sales growth. A case of price gouging? The other way would be to make the rupee weaker by bringing down interest rate, currently at 7.25%. A substantial cut in the interest rate will bring down the cost of borrowing, thereby making it easier for companies to borrow money to fund new investments, allow banks to reduce bad loans, by reducing interest burden on business, and bring down the rupee, by reducing influx of foreign money, coming to take advantage of higher interest on deposits. The US has got out of recession by weakening the dollar through quantitative easing. Europe and Japan have followed suit. Trouble is, a weak rupee instantly pushes up import costs, and since we always import more than we export, it results in inflation. Rise in prices means that rupee buys less and less, which results in further weakening of the rupee. China has built up foreign currency reserves of around $4 trillion by buying dollars from the market to keep the renminbi weak but it has still appreciated against the dollar while the rupee has fallen. Because of uncontrolled inflation in India. The rupee is falling against the dollar but all other currencies, including the Euro, have fallen much faster. So, should the RBI weaken the rupee to stimulate exports, praying that oil continues to remain cheap, or should it allow the rupee to appreciate to encourage consumer demand which may increase growth? Should the rupee fly high or lower down? Difficult question.