The Indian rupee lagged in 2025 despite India’s strong economic fundamentals, the Economic Survey 2026 said on Thursday, arguing that a weaker currency does not “hurt” for now as it softens the impact of higher US tariffs on exports. The rupee’s valuation does not accurately reflect India’s stellar economic fundamentals, said the survey. "In other words, the rupee, therefore, is punching below its weight. Of course, it does not hurt to have an undervalued rupee in these times, as it offsets to some extent the impact of higher American tariffs on Indian goods, and there is no threat of higher inflation from higher-priced crude oil imports now."