Corporate borrowers in India have been hard hit by the rupee slide—the currency fell 18% over the dollar between January and November, 2011, and fell 7% in November alone.
According to the Associated Chambers of Commerce and Industry, Indian companies have borrowed $29 billion overseas since the beginning of 2011, taking advantage of lower interest rates. Depreciation in the rupee over the same period has made repaying these loans costlier.
The government raised the ceiling on foreign investors holding Indian debt—by $5 billion for each of corporate and government debt—in early December.
In a historic development in November 2011, the Indian government decided to permit the entry of foreign retailers selling multiple brands. Prior to this decision, only retailers selling single brands had been allowed in. Foreign retailers, such as Wal-Mart and Carrefour, will be permitted to operate in 53 cities that have a population of over 1 million but will be required to purchase at least 30% of their products from small-scale Indian manufacturers.