Indian defence firms seek protection from exchange rate variation

India's private defence firms had last campaigned for ERV protection after being bruised by the rupee's fall from Rs 44 a dollar in October 2010 to below Rs 56 just a few months later

The exchange rate of US dollar vis-à-vis Indian rupee has fallen to Rs 79.74 to the dollar, down from Rs 74.55 a year ago. The 6.96 per cent fall in rupee against dollar in just one year is making private Indian defence companies consider petitioning the Ministry of Defence (MoD) for protection against exchange rate variation (ERV).

The non-manpower allocations to the three services in 2022-23 adds up to Rs 2.22 trillion, 50 per cent of that, or Rs 1.11 trillion, can be conservatively assumed to be going to foreign original equipment manufacturers (OEMs). ERV accounts for another 6.96