Indian Rupee Hits Record Low Amid US Visa Fee Hike and Trade Tensions

Rupee Declines to Historic Low

On Tuesday morning, the Indian rupee plummeted to a record low of 88.64 against the US dollar, influenced by external pressures such as tariffs from the US and an increase in H-1B visa fees. This significant drop reflects ongoing uncertainties in trade policies and a growing risk aversion among local investors.

At 10:45 AM, the rupee's value fell by 36 paise from its previous closing rate of 88.28. The earlier record low was noted at 88.44 on September 11.

According to reports, the rupee has been identified as Asia's least performing currency this year.

Recently, US President Donald Trump enacted an executive order mandating companies to pay $100,000 for new H-1B visa applications, a sharp increase from the previous fee of $215 for entering the visa lottery, along with additional filing costs.

H-1B visas enable US companies to temporarily hire foreign workers for specialized roles, with a significant number of these visas being issued to Indian nationals. In the fiscal year 2022-2023, Indians accounted for 72.3% of all H-1B visas granted by the US.

The repercussions of these changes were evident in the stock market, where the IT sector's sub-index dropped nearly 3% on Monday. The technology industry in India relies heavily on the US market, generating approximately 57% of its revenue from there, and has historically benefited from the H-1B visa program.

Additionally, India is contending with challenges stemming from reciprocal tariffs imposed by the US on Indian products and penalties related to the purchase of Russian oil amid the ongoing conflict in Ukraine.

Earlier on Monday, Union Commerce Minister Piyush Goyal engaged with US Trade Representative Jamieson Greer in New York to expedite trade discussions between the two nations.