India Tourist Sites Won’t Accept U.S. Dollar

January 3, 2008 · Print This Article · Email This Post

Indian RupeeThe Tourism Minister of India, Ambika Soni, said today that the weakened U.S. dollar (USD) will no longer be accepted at major Indian tourist sites such as the Taj Mahal. The dollar has hit a new nine-year low against the rupee. This is the second country which has stopped accepting the USD as payment, the first having been Iran late last year.
 

While the USD in the past was worth about 50 rupees, with tourists charged either $5 or 250 rupees to visit sites such as the Taj Mahal, it fell 11 percent in 2007 and is now worth about 39 rupees. Soni told IBNLive News of India that even before the USD plunged, there was a demand to have rupee-only admission ticket sales. But now, with the weakened dollar, the decision to switch to the rupee-only payment system has been made.

Taj Mahal, IndiaThe Taj Mahal, which has been refusing dollars since November, had charged $15 (or 750 rupees) for admission; now admission for American tourists will cost $20. Matters will probably get worse. Agam Gupta, head of foreign exchange trading at the Standard Chartered Bank of India said: “We expect a slight appreciation of the rupee to continue, although it won’t be as dramatic as last year. . . The U.S. dollar has fallen against most major currencies, now trading below parity with the Canadian dollar, and it has lost ground against the rupee due to an influx of foreign capital into India.”

The dramatic decline in the value of the U.S. dollar is blamed mostly on the huge cost of financing the war in Iraq, as well as rising oil prices and increasing competition from China and other countries for that oil. Crude oil prices are up 70 percent in the past year. The credit crunch, home foreclosures and a generally recessionary atmosphere in the States have not helped either. Meanwhile, oil has hit the $100 a barrel mark in the first two days of 2008 trading at the New York Stock Exchange, sending stock prices sharply lower, while boosting gold to a new historic high of $868 an ounce — more than tripling the price of that commodity in the past eight years.

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