“The shine has come off India. It’s not the glaring success story it was a few years ago.”, Daniel Martin, Capital Economics
Those fundamental weaknesses — poor infrastructure, unreliable power supply, difficulty in securing land and lots of sticky red tape — are all keeping foreign investment out of the country, and that’s a problem for a country that imports far more than it exports and thus needs to finance a large current account deficit. When the CAD widens, the rupee’s decline accelerates further. So even at a time when many emerging markets are looking risky to investors, India is looking riskier than most.