Depreciation shouldn't deter NRIs from India returns: Azeez

Azeez pointed to dollar-cost averaging as a practical hedge. NRIs who invest a fixed dollar amount each month buy more rupees when the currency is weak and fewer when it is strong. Over time, that smooths the entry price. "The worst thing an NRI can do is try to time the rupee," he said.

For those already invested, the question is less about the currency and more about the asset mix. Large-cap Indian equities have historically offered lower volatility and more consistent dollar returns than mid- or small-cap names. Fixed-income investors face a different calculus: rupee bonds pay a premium over dollar bonds, the currency risk is uncompensated if the holding period is short.

Azeez's view is not a blanket endorsement. It works only if Indian assets keep compounding at double-digit rates. A slowdown in corporate earnings growth or a spike in inflation that forces the RBI to hold rates higher would compress the return gap. The rupee could also weaken more than 3% in a given year, as it did in 2023 when it fell roughly 8% against the dollar.

Still, the framework is useful. NRIs who sell Indian assets because of the rupee alone are making a bet on currency timing, not on the underlying investment case. Azeez's advice: stay invested, keep the time horizon long, and let compounding do the work the currency cannot.