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1 USD to INR in 1947
December 1, 2020 Currency Exchange
6 minutes, 7 seconds Read

1 USD to INR from 1947 till now, Historical Exchange Rates Explained

1 USD to INR in 1947

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Last Updated on: Dec 1, 2020

Introduction

The US dollar serves as the world’s most dominant currency. Regarded as the benchmark currency, the US dollar determines the value of other currencies in the universal market.

The US dollar is also one of the most commonly used currencies in international investment and trade. Trading with the dollar is much easier than any other currency. The emergence of the dollar as an indispensable medium of exchange began after World War I placed restrictions on exchanges.

Since then, the dollar has been enjoying worldwide attention. In light of this, the Indian currency, like various others, is compared against the dollar to determine its value. But the history involved in the process of scaling the INR helps in understanding the Indian economy better.

What’s been the value of 1 USD to INR since 1947 till date?

The 1 USD to INR exchange rate has always had extreme volatility since the inception and seen plethora of fluctuations over the years. We have brought you 1 USD to INR values table ranging all the way from 1947 till date so that you can see the change in INR’s value.

YEAR1 USD TO INRYEAR1 USD TO INR
19130.09198512.37
19250.1198612.61
19474.16198712.96
19483.31198813.92
19493.67198916.23
19504.76199017.5
19514.76199122.74
19524.76199225.92
19534.76199330.49
19544.76199431.37
19554.76199532.43
19564.76199635.43
19574.76199736.31
19584.76199841.26
19594.76199943.06
19604.76200044.94
19614.76200147.19
19624.76200248.61
19634.76200346.58
19644.76200445.32
19654.76200544.1
19666.36200645.31
19677.5200741.35
19687.5200843.51
19697.5200948.41
19707.5201045.73
19717.49201146.67
19727.59201253.44
19737.74201356.57
19748.1201462.33
19758.38201562.97
19768.96201666.46
19778.74201767.79
19788.19201870.09
19798.13201970.39
19807.86Dec'1973.66
19818.66Jan'2071.29
19829.46Feb'2071.59
198310.1Mar'2074.53
198411.36Jun'2076.38

Breaking the monotony on this legendary question–How the Indian rupee has devalued since 1947 till date? We’ve come up with a detailed answer that clarifies the smog from this long-lived question. Honestly, it is nothing more than a myth. If you are thinking that exchanging 1 USD to INR in 1947 would have got you 1 Rupee exactly, then, sadly, that’s not true. ‘Why‘ do you ask? Here’s the answer:

  • When India got her independence in the year 1947- there were no outstanding credits on the
    the balance sheet of India that kept Indian Rupee at parity with the US Dollar.
  • Another fact that one should notice is that India was under British Raj prior to its independence thus, the Indian Rupee was pegged to Pounds then, keeping the value stable at that moment, which obviously, didn’t last long.
  • As reported: from 1927 to 1966, 1 pound valued to 13 INR. The arrangement ended in the year 1966 and the rupee started witnessing devaluation.
  • In fact, after the independence when India launched its 5 Year Plan, the Indian Rupee resultingly used to peg with the U.S. dollar at a rate of 7.5 rupees = 1 dollar until 1971.

Another question that arises is that —What was the actual worth of 1 USD to INR in 1947 exactly?

Although, after Independence, the Indian rupee continued to peg to the British pound at a rate of 1 rupee = 1 shilling and 6 pence what can be withdrawn from the stated that as 13 1/3 rupees per British pound. However, the sources state that British pound would have worth about 4 USD at that point of time – hence, concluding that the US Dollar would’ve been more than Rs 3 then.

Note: India became a republic nation in 1950. The constitution of India came into existence in 1952. At that time 1 USD was equal to 4.16 INR or 1 USD =4.16 NCU. (NCU is National Currency Unit)

Factors Contributing To The Indian Rupee Depreciation (1 USD to INR) – History Explained

The inception

Indian currency began to be measured against the US dollar in 1947 after India gained its independence. The value of 1 INR then could be taken as 1 USD, considering that the national balance sheet was free from any credit or debit.

However, the value of Indian currency was derived from the British pound, which then was 1 £ equal to 13 INR. And owing to the absence of a standard form of currency comparison until 1944, this valuation of INR against the British pound remained dominant.

 

Year-wise Dollar vs. Rupee- issues from 1947 to 1967

The value of 1 INR in 1947 was 4.76 (if a direct comparison is not made). This value continued till 1966. But the Indian economy started witnessing a downfall starting from the 1950s. This was on account of the country’s credit from the international market.

The situation was worsened by the 1962 war of India and China, followed by the 1965 war of India and Pakistan, and the drought that had hit the nation in 1966. All these turned the exchange rate of 1 Dollar to INR 7.50 by the year 1967.

 

Further Fall in Rupee Value- 1973 Oil Crisis

Rupee value fell to 8.10 in 1974 following the Oil Shock that took place in 1973 due to the decision of the OAPEC or Organisation of Arab Petroleum Exporting Countries to reduce production.

To combat the situation and the subsequent political crisis, India had to borrow foreign currency. This resulted in the fall of the Indian currency value. The exchange rate deteriorated throughout the 1980s and reached a value as high as 17.50 in 1990.

 

1 USD to INR in 1990 – the Economic Crisis

India’s economy was going through a tough time in the 1990s. Interest payment accounted for 39% of the revenue that the government collected at the time. Fiscal deficit reduced to 7.8% of GDP, and India on the verge of being declared a defaulter in the international market.

This crisis called for a devaluation of the Indian currency. Devaluation is a process where countries reduce the value of their currency in the international market while keeping their internal value intact. India took a similar approach to make its export market cheaper and its import market costlier.

 

INR value since 1992- the effect of Devaluation

The devaluation turned the exchange rate of 1 USD to 25.92 INR in the year 1992. The Indian currency value began falling since then, with a current rate of 74 INR. Dollar price in 2004 was 45.32 INR, and in the next ten years, it rose to 62.33. In 2016, February was the month to witness Dollar to INR highest rate ever, amounting to 68.80 INR.

 

USD to INR in the year 2020

The current exchange rate of 1 USD is 73.64 INR. The depreciation of the Indian rupee has occurred by about 7 percent since the beginning of this year. One of the reasons for this is the change of ownership of the Yes Bank, which has created apprehension among the investors in regards to the stability of Indian banks. The pandemic is another prominent reason for the depreciation.

The value of INR is largely related to crude oil prices. As oil price increases, the value of Indian currency also decreases, and vice versa. The withdrawal of foreign investors from the Indian market is another contributing factor. Government debts can cause investors to lose interest in the country’s market, resulting in inflation. Factors like these may combine with several others to cause further depreciation of the INR in the future.

Conclusion

Thus, it can be inferred that the Indian currency value has witnessed a gradual decrease since 1973. However, financial analysts believe that devaluation has been beneficial for the country to deal with crises. The developing country that India is, depreciation is likely to continue over the years. And this will bring a profound impact on the country’s economy. Moreover, the country is expected to benefit from the decreased value of Brent oil in the light of the current war about oil price, thereby easing the depreciation to some extent.

Read more: Full History of Indian Rupee & USD to INR in 1947

1 GBP to INR in 1947 till now

References

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