Mumbai: P Chidambaram, Indian Finance Minister said that Indian currency (rupee) could go up more due to solid growth in the economy. The other reason for the appreciation is that the exporters need to become more aggressive in the world wide market.

The traders said that the statement pushed the Indian rupee to its firmest level in nearly a decade, but the suspected RBI involvement blocked the admiration.

While talking to the trade and industry associates at a conference, Mr. Chidambaram said, “With the economy growing at an average rate of 8.6 percent, the rupee is bound to strengthen.”

“One must learn to become competitive, learn to cut costs and learn to innovate,” Mr. Chidambaram added.

Traders said that the Indian currency (rupee) closed steadily at 39.31/32 a dollar with the RBI actively purchasing dollars after it came up to 39.22 at once after Chidambaram’s remarks.

“One must learn to trade in the environment, where the rupee will strengthen. What is causing concern is the rapid appreciation of the rupee,” Chidambaram said.

He also told that exports were still rising at 18%.

"Merely because the profits are down does not mean we should present an alarmist picture. We have given support and it will be completely wrong for exporters to boost bottomlines by retrenching jobs,” he added.

He said that at current exchange rates, India’s income per person was projected to climb to $1,000 by the end of the existing fiscal (March 2008) due to 9 percent increase in the economic growth.

According to the statistics available from RBI’s Internet site: www.rbi.org.in, the per capita income stood at $797 in 2006/07, which was nearly doubled as compared to $460 in 2000/01.

India’s economic system experienced 9.4% growth in 2006-07.

Mr. Chidambaram stated, “Per capital will double every nine years. By 2016/17, per capita will be $2,000 if we grow at 9 percent and in another nine years, by 2025, per capita would be $4,000 and that will make us a middle-income country.”

He also told that the administration would think up directions in order to make use of its growing forex reserves to amend infrastructure.

According to India’s estimation, it requires $475 billion between 2007 to 2012 to upgrade its roads, expand and modernise its ports, improve rail services and boost power generation.