Impact of Foreign Exchange Fluctuations on Exports and Imports in India

Abstract

This study examines the impact of foreign exchange fluctuations on India's exports and imports, analyzing how currency volatility affects trade competitiveness, import costs, and economic stability. Given India's dependence on global trade, exchange rate variations play a crucial role in shaping its economic performance. The research utilizes Time-Series Analysis, Regression Analysis, and Correlation Analysis to assess the relationship between exchange rates and trade volumes. Key sectors such as pharmaceuticals, textiles, IT services, crude oil imports, and engineering goods are examined to understand industry-specific effects. Macroeconomic factors like inflation, interest rates, and global economic conditions are considered to provide a holistic view of trade dynamics. The findings offer policy recommendations to help policymakers, exporters, and importers mitigate risks, optimize trade strategies, and enhance economic resilience