India's Economy is in DANGER | Rupee is Collapsing | Dhruv Rathee

2.7 trillion rupees.

Foreign investors have withdrawn this much money from India in the last 6 months.

Look at the difference between the two bars in the graph.

Indian Rupee was the worst performing currency in Asia.

On one hand, people are losing jobs,

and the figures showed that on the other hand,

their real salary, which should increase every year, was decreasing.

"But we must prepare for the worst.

Be ready for tough times."

In a small house in Surat, in Gujarat,

A father is telling his two daughters,

that they would be going to a new school from the next month.

Now they would have to go to a government school, not a private one.

This man's name is Alpesh Bhai.

A few years ago, his life was a success story.

Alpesh's family used to farm in a village in Gujarat,

and earn enough to survive.

But then Alpesh went to Surat.

The world's largest diamond hub.

He started working in a diamond factory there,

and shortly after, his salary reached ₹35,000.

For a lowly educated man from the village,

it was a very good salary.

For the first time, Alpesh found financial stability,

and he got his daughters admitted to an English-medium private school.

Alpesh wanted to give his children the education he never got.

But then, in the year 2025,

everything started to fall apart.

"Tariffs imposed by the US have been catastrophic for India's diamond industry."

A terrible crisis struck the diamond industry in Surat.

"Diamond is not being sold anymore.

Our stock just lies in the market."

Alpesh's salary fell to ₹18,000.

And then, after a few months,

his factory fired 60% of its workers.

Eventually, he was also fired from his jobs.

After that, when Alpesh started looking for work,

he got a job of carrying bundles of clothes.

At a salary of only ₹12,000.

Today he pulled out his daughters from private schools

and put them back in government schools.

All this was happening at a time when the Modi government, was saying

that India was the world fastest growing major economy.

"Today, India is the world's fastest growing major economy."

On the papers, India's economy is growing at a speed of 8.2%.

But what is the reality here?

A few months after this statement of being the fastest growing economy,

on 10th May, 2026,

in a rally in Hyderabad,

Prime Minister Narendra Modi appealed to the people of the country,

not to buy gold for a year.

To postpone foreign trips.

To use less petrol and diesel.

To work from home.

Just like they did during the COVID-19 pandemic.

Modi even appealed to use less cooking oil.

"Every family that uses cooking oil,

if they reduce its consumption,

as I have repeatedly said,

to reduce it by 10%,

If we reduce the consumption of oil,

then it is a great proof of patriotism."

The reason behind all this was said to be that

we have to save on foreign exchange expenditure.

"We have to give a lot of emphasis on saving foreign currency."

If anyone sees these two news together,

they will be very confused.

On one hand, India's GDP growth seems to be doing well.

India is being presented as the fastest growing economy.

On the other hand, the Prime Minister of the country,

is appealing to the public to reduce cooking oil consumption.

Let's understand the real situation behind the GDP and our economy

that the government is hiding from you.

"The Indian rupee has slipped to around ₹96 per US dollar,

making it the weakest Asian currency in 2026."

"I'm in the government, that's why I know

our rupee can't fall this fast.

The country wants to know,

hon'ble Prime Minister, what is the reason

that today, the only Indian rupee has fallen so low against the dollar?"

Hello, friends!

29th August, 2025,

the India's GDP performance was published.

From April to June 2025,

GDP grew at a rate of 7.8%.

This was 1.3% higher than the RBI's own forecast.

The numbers were looking good.

Credit rating agency Fitch

upgraded its forecast for India's annual growth rate

from 6.5% to 6.9%.

And the same week,

the Ministry of Statistics and Programme Implementation

quietly released a report.

In this report, for the first time,

the government published quarterly data from the informal sector.

And the data that was presented in this report,

raises questions about the India's GDP growth story.

According to this report,

in the quarter of April-June 2025,

where GDP increased by 7.8%,

in the same quarter,

in the informal manufacturing sector in India,

the number of jobs declined by 9.3%.

In the informal sector,

jobs fell from 131.3 million to 128.6 million.

In just 3 months,

2.7 million people lost their jobs.

And the scary thing is that this is just a trailer.

An even more dangerous job crisis is still to come,

because of AI.

The World Economic Forum estimates that by 2030,

due to AI and automation,

more than 90 million jobs will be lost.

Experts in India are warning that in the next 2-3 years,

400,000-500,000 jobs in the IT sector alone,

could be in danger.

Companies like TCS have already started to lay-off thousands of employees.

Now, ask yourself,

if your company finds an employee,

who can do an 8-hour task in an hour,

whom would the company prefer?

This is the real danger.

AI won't take your job directly,

but the AI user,

who can work 5 to 10 times faster than you,

can replace you.

There is a positive side to it too.

It not too late.

According to the WEF report, 170 million new jobs will be created.

The question is not whether AI will take your jobs,

the question is, on which side will you be?

And that's why I created the AI Masterclass.

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but the world will not postpone adopting AI.

Now, back to our topic,

the question is, if millions of people are losing their jobs,

they don't have the purchasing power,

how is the market so prosperous?

How are cars, AC, fridge, mobile, etc. selling?

Where is the money coming from?

The answer to this is just one word,

Loan.

EMI.

"Can you see this apple?

It's beyond your reach.

And this is not a ₹100 apple.

It's beyond what you can afford."

"I've bought this phone.

I've heard that girls are impressed by iPhones."

"Which phone do you use?

And what is your bank balance?"

"iPhone 15.

But my bank balance is zero."

According to RBI, by March 2025,

the GDP share of debt on Indian households had increased to 41.3%.

In 2021, this number was at around 36%.

If you look at this number in isolation,

taking loan itself is not bad,

if it is taken to build a house or business.

But the story here was dreary.

According to the RBI data,

the largest 55.3% of this loan is for non-housing retail loans.

Like personal loans,

credit card EMIs,

vehicles, and things like ACs, TVs, and fridges.

So people are taking more loans than before,

just to fulfil their needs.

They're funding their lives with loans.

"People pay taxes,

save,

withdraw for daily expenses from their credit card,

borrow money on interest,

then they borrow more on interest to repay the loans."

But it's not like people are spending on nothing.

People are being attacked on two fronts.

On one hand, people are losing their jobs,

and the figures show that on the other hand,

their real salary,

which should increase every year, is decreasing.

According to the International Labour Organisation,

in 2012, the average Inflation Adjusted Salary

of a regular salaried worker, was ₹12,100.

By 2022, it had decreased to ₹10,925.

If you look at the salary numbers of people,

you'll see an increase.

But if you look at the inflation,

in reality, they were earning less than 10 years ago.

By 2025, the situation got so bad that

only 10% of people

can spend money on other things after fulfilling their needs.

The remaining 90% of people are struggling to fulfil their needs.

Do you realise how significant this is?

About 60% of India's GDP

comes from private consumption.

The Indian economy is in full swing when the common people spend money.

This is the reason why the demand seems strong.

Like the economy is running smoothly.

But in reality, the people's buffer has weakened.

The ability to absorb any shock has become very low.

The data that I have given you so far,

the state you saw, was from mid 2025

From then to now, over the last year,

the economy faced 3 major shocks.

First, on 27th August, 2025,

US President Donald Trump imposed a 50% tariff on India.

25% was a retaliatory tariff,

and 25% was the punishment for buying Russian oil.

This was a big shock for the Indian economy,

because the US is one of the biggest trading partners for India.

The Think Tank Global Trade Research Initiative has estimated that

after tariffs,

India's US exports would fall from $86.5 billion

to $50 billion.

And in sectors like textiles, gems, and jewellery,

there would be a 70% decline.

This will put millions of jobs in danger.

After these tariffs, in 2025,

India's stock market was the worst performer among the developing countries.

Foreign investors took their money out of the Indian market in the record numbers.

On 2nd February, Trump reduced tariffs from 50% to 18%.

But what the Modi government agreed to in return,

was the second biggest shock.

Trump directed that India would not buy Russian oil.

And instead, would buy American products worth more than $500 billion.

"And he assured me today that they will not be buying oil from Russia."

Until 2025, even after the sanctions on Russia,

the oil that we were importing from Russia,

stopped coming in all of a sudden.

And right at this moment, the third shock came.

On 28th February, 2026.

The Iran War.

After the US and Israel attacked Iran,

Iran blocked the State of Hormuz.

Between February and April,

crude oil's price increased by 58%.

And the price of fertilisers increased by 66%.

And India suffered the biggest loss.

India imports 55% of its oil from the Middle East via the Strait of Hormuz.

On one hand, due to the pressure from America

we had stopped oil imports from Russia.

On the other hand, due to the Iran War,

the oil from the Middle East was also at a standstill.

In March, oil imports declined by 40%

The Indian economy was already in a bad state.

And due to these three major shocks,

the entire economy began to crumble.

This directly affected our kitchens.

After the state of Hormuz was blocked,

the price of the domestic LPG cylinder increased by only ₹60.

But the real crisis was that

even after the price of the cylinders increased,

the cylinders were not available.

A domestic cylinder of ₹913,

was being sold for ₹2,000-₹2,500 in black.

In May 2026,

within 10 days,

the petrol and diesel prices increased by ₹7.5 per litre.

But despite all this,

in the government figures,

the official inflation rate of May 2026,

was only 3.93%.

Once again, after looking at the official numbers,

it seems fine.

Everything should be fine.

But an economist from JNU, Arun Kumar, said that

the real inflation rate for the poor was not 4%,

but 60%.

"The inflation for the poor people is very high.

If you are earning ₹10,000 to ₹11,000 per month,

and a gas cylinder of 14 kg,

which was ₹950, now costs ₹5,000,

then your rate of inflation is 60%.

Your rate of inflation is not 4%."

Does this mean that the 3.93% figure is wrong?

No.

But it is an incomplete truth.

The real effect is seen in the wholesale prices.

Which is the stage before retail.

In April 2026,

the wholesale price inflation reached the highest in the last 3.5 years.

At 8.3%.

That month, the wholesale inflation of fuel and power was at around 25%.

And the costs were rising in 21 out of 22 manufacturing categories.

Meaning that the inflation is ready to explode.

Along with this inflation, another concern that could increase

the value of every imported thing is the falling rupee.

On 20th May, 2026,

Indian Rupee reached its all-time low of ₹96.90 against a US dollar.

And due to this, in 2026, the Indian Rupee,

was the worst performing currency in Asia.

To put it simply,

Rupee is weak when the dollar reserve of our country runs low.

Fewer investments and fewer exports.

And because of imports, the demand for dollars increases.

The expenditure in dollar increases too,

and the rupee loses its value.

The falling rupee doesn't mean that only travelling abroad gets expensive.

India imports 90% of the crude oil we need.

So when the rupee falls,

oil, fertiliser, machinery, everything becomes more expensive.

And because of the falling rupee,

the foreign exchange reserves of India is also falling rapidly.

The week Iran was attacked,

that week, India's foreign exchange reserves

were at a record high of $728 billion.

But only 4 months later,

it fell by $61 billion,

and reached $667 billion.

From this number,

if you remove the gold and RBI transactions,

India has only $471 billion left to use.

Do you know how shocking this number is?

It doesn't even meet our 6 months' import requirements.

Since 2014,

this has never been so bad.

In such a situation, foreign investors are usually the ones who save the country.

The ones who bring in dollars.

But they have already gone.

In 2020-21, where the net foreign direct investment was $43.9 billion,

in 2024-25, it fell to only $0.96 billion.

Look at the difference between the two bars in the graph.

Last year, in 2025,

foreign investors took out ₹1.66 trillion from the Indian market.

And in the first 6 months of 2026,

do you know how much was withdrawn?

₹2.7 trillion.

Foreign investors have withdrawn this money from India in the last 6 months.

Not everything here is the fault of the government,

but there is no doubt that

the foolishness of the Modi government

has worsened this crisis.

"Economy."

"If I talk about the economy,"

"Go up, rise!"

Earlier, India used to buy oil from Russia.

And paid for it in Chinese Yuan or Russian Rubles.

We'd save Dollars there.

But under Trump's pressure,

we stopped buying oil from Russia.

Buying it from Venezuela instead.

America was basically selling it,

and we had to pay for it in dollars.

And a few months ago, as you must have heard,

Donald Trump kidnapped the President of Venezuela.

After that, America also took over the control of Venezuelan oil.

The second big stupidity is that

instead of bringing in investment in dollars,

to reduce tariffs,

the Modi government,

promised Trump that India would buy goods worth $500 billion from the US.

And as I said, the more India buys American goods,

the weaker the rupee will get.

The situation is so bad that many are wondering if

Indian Rupee would fall to ₹100 per dollar.

On this, a member of PM Modi's Economic Advisory Council,

Shamika Ravi said,

even if this happens, it's not a big deal?

100 is just a number.

"The way the dollar is becoming stronger,

the rupee is becoming weaker,

India will not be able to maintain its position in world trade.

Our exporters, our importers,

they won't be able to withstand this depreciation."

In May 2026, Kotak Mahindra Bank's founder Uday Kotak also warned about this.

"We have not seen the impact in the last two months of the Middle East war,

in terms of energy price transmission.

It's coming, and we must prepare for the worst.

Therefore, it is about preparation.

Be ready for tough times."

Due to tariffs and war, many export hubs are in danger.

The jobs of millions of people are in danger.

Tamil Nadu's Tirupur is also known as the Dollar City.

India exports garments worth $16 billion,

one third of it comes from here.

But after the tariffs by America,

the combined duty on Tirupur's products at one time,

was around 64%.

While our competitors,

the clothes exported by Bangladesh,

have to pay a duty of around 35-36%.

This is why an exporter in Tirupur suggested that

due to tariffs, 150,000 workers could lose their jobs in this city alone.

It's the same in the shrimp industry,

a large part of the farmed shrimps are exported to America.

People are already being fired from their jobs.

Because there is no order.

And this is not a small industry.

About 2 million people work in it.

It's the same with the diamond industry in Surat.

In 2022, after the Russian-Ukrainian war,

it was already under pressure.

because about one-third of their raw diamonds came from Russia.

After the Russian War, the flow of raw material declined.

And when the US imposed tariffs,

the situation worsened.

So far, in Surat,

400,000 workers have seen either a pay cut,

or they have lost their jobs.

I told you about Alpesh in the beginning of this video,

whose children had to leave private schools and go to government schools.

But some families have paid a higher price.

According to the Diamond Workers Union,

by November 2024,

at least 71 diamond workers had committed suicide in Surat.

And in the last 12-14 months,

about 50,000 workers left Surat and returned to their villages.

The Union's Vice President says

that he had never seen such an exodus before.

"I won't come again, friend.

I won't come again, I'm telling you."

In such dire circumstances,

every economics textbook says that

the government should come forward,

open its treasure,

and give people jobs.

But the biggest problem in our story is this.

The government is not doing anything,

because their treasury is sitting empty.

In 2014, when Modi formed the government,

the total debt on the Central and State Governments was ₹62 trillion.

by 2026, it has exceeded ₹197 trillion.

When this government came into power,

the debt-to-GDP ratio of the country was 56-58%.

But by 2024, it had reached 81%.

And now it is around 82%.

Most economists advise that

this ratio should be less than 60% for developed countries.

And for developing countries, it should be less than 40%.

The impact of this loan is that

most of the government's income

goes into repaying the old bills.

According to the Business Standard,

the 25% of the government's revenue goes into paying interest.

Then 28% in salaries,

15% for pensions,

and another 15% on subsidies.

That means that more than 80% of the money is already booked.

To fight a new crisis,

there is next to nothing.

The question remains, what will happen next?

The forecast is quite scary.

Morgan Stanley forecasts that

India's GDP growth would go down from 7% to 6.7%.

Because oil's import bill will go up by 41% next year.

If this war continues till the end of this year,

India's GDP will suffer a loss of 2.38%.

And farmer income can fall by 27%.

In the 2018's official roadmap,

the government mentioned that India would become

a $5 trillion economy by 2025.

The previous deadline was 2022.

Then, the deadline was extended to 2025.

And today, in 2026,

and India's economy is stuck at $3.9 trillion.

According to a SBI research, this dream might be fulfilled by 2030.

This is why these politicians have stopped talking about $5 trillion economy.

And now they talk about 2047.

"Our aim is 2047.

India should be developed."

In Business Standard, financial journalist Debashish Basu had written,

that India is entering a time

where we cannot afford to make any mistakes.

The truth is that if the government wants,

they can save money.

But they don't want to.

They continue to burden the public.

PM Modi is still going on foreign visits to some country every other week.

There, they organise cultural functions for him.

Who pays for it?

Taxpayers.

He visits tourist sites there.

Sometimes he takes pictures with tortoises,

and sometimes he watches dancing and singing.

Similarly, the government is wasting hundreds of millions

on running ads on news channels.

What's the need to run these ads on TV?

Everyone has seen Modi's face hundreds of times.

I'd like to say that in such difficult times,

we need to stop paying for ads on TVs and bill boards.

If these pro-government media channels stop showing these ads,

it won't harm anyone.

But if the diamond industry in Surat,

or the Dollar City of Tamil Nadu,

collapses,

there will be a huge loss.

And experts are warning on yet another front.

Historically, due to El Nino,

rural unemployment increases,

and jobs are lost.

And as I explained in this video,

this year's El Nino, which has already started,

is going to be one of the most terrifying El Ninos in the world.

If you're wondering what an El Nino is,

then you can click here to watch this video.

You'll get to learn about new things.

And click here to join the AI Masterclass,

to upskill yourself in the field of AI.

Thank you very much!