Neelkanth Mishra, the newly appointed World Bank Executive Director, has addressed the ongoing volatility of the Indian rupee against the US dollar, attributing it to liquidity issues rather than weaknesses in India's economic fundamentals. He noted that the depreciation is primarily driven by market panic rather than genuine concerns about India's solvency. Mishra emphasized that the exchange rate level, whether at 99, 100, or 101, is less significant than the volatility that can harm the economy. He explained that high currency volatility raises India's long-term cost of capital, as global investors demand higher risk premiums, and delays investment decisions. Mishra pointed out that while the Reserve Bank of India (RBI) intervened with $75 billion, the actual balance of payments deficit was $24 billion, indicating a mismatch in market dynamics. He proposed measures to stabilize the currency, such as removing taxes on foreign bond investors and possibly implementing temporary crowd control measures. He expressed confidence in the RBI's reserves of approximately $690 billion, suggesting they provide ample capacity for intervention if necessary. Mishra concluded that reducing rupee volatility could enhance investor confidence and improve perceptions of the Indian economy.