India does not need to defend the rupee because its economic fundamentals are such that the currency can take care of itself, the country’s Chief Economic Adviser V. Anantha Nageswaran said on Tuesday.

“I think India isn’t defending the rupee, India is just making sure that the market forces and the economic fundamentals direct the rupee in a particular direction and making sure it happens smoothly and gradually,” he told an event.

“I don’t think Indian fundamentals are such that we need to defend the rupee. The rupee can take care of itself.”

The chief economic adviser said that India should be able to grow at about seven per cent annually this decade as investment spending is expected to rise and the digital economy picks up.

The government has already said it expects the world’s fifth largest economy to grow at more than 7pc this fiscal year, after it expanded by 13.5pc in the April to June quarter, the fastest pace in a year.

Economists, however, say growth is likely to lose momentum in the coming quarters as higher interest rates cool economic activity.

“While international agencies are showing our trend growth at 6pc, I feel the trend growth will easily be 7pc per annum for the remainder of this decade and beyond,” he said.

“I am taking 6pc as the very easily attainable growth rate and I am adding 0.5pc coming from the capex (capital expenditure) pool and another 0.5pc will come from the digital public infrastructure that we have created.”

Nageshwaran said that “investment spending which we had experienced back in 2006 to 2012, is going to come back and that is going to be one major driver (for growth)”.