New Delhi: India’s economy may be growing at 7.8 per cent, but that does not mean the country can afford to spend its foreign exchange freely, Zoho co-founder and Chief Scientist Sridhar Vembu said Wednesday.
Vembu weighed in on a question circulating on X after Prime Minister Narendra Modi urged Indians to avoid unnecessary foreign travel, weddings abroad and buying gold unless necessary, even as India posted 7.8 per cent GDP growth.
“Foreign trips, if you are going for leisure, you should not go. If you are getting married abroad, you should not do so. And if it is not necessary, you should not buy gold either,” Modi said in a video posted on X from Bishkek, Kyrgyzstan.
Responding to an X user who asked why the government was urging people to curb such spending despite rapid economic growth, Vembu argued in three points that India was in a phase similar to that once experienced by Japan, Taiwan, South Korea and China.
“East Asian nations all went through a phase of rapid GDP growth combined with the need to conserve foreign exchange,” Vembu said.
"If economy is growing at 7.8% why is the PM asking us not to travel abroad, not to buy gold, not to have foreign weddings etc"
Let me explain: East Asian nations (Japan, Taiwan, South Korea and later China) all went through a phase of rapid GDP growth combined with the need to… https://t.co/1HdLAUDaej
— Sridhar Vembu (@svembu) September 2, 2026
‘Look at East Asia’
According to him, rapid economic growth can itself increase a country’s dependence on imports. India, he said, still relies on other countries for energy and advanced technology, and a faster-growing economy requires more of these inputs.
“Even our exports need advanced technological inputs (precision machines, materials, CPUs, GPUs, advanced software etc) that we need to import today,” he wrote. “Catching up in all of these areas takes time, often measured in decades. We have made a good start but we need time.”
He compared the situation with East Asia.
“Look at how long it took East Asia to catch up with the West. Their economies were growing rapidly even as they worked hard to conserve foreign exchange,” he wrote. “That is exactly what our government is trying to do.”
Vembu also argued that India would need to build domestic technological capacity and achieve greater energy independence before it could reduce its need to conserve foreign exchange.
He compared India to a fast-growing company that needs to conserve capital to invest in future expansion.
“Our nation needs to conserve foreign exchange likewise,” he wrote.
(Edited by Stela Dey)