A key impact of the Fed rate hike will be that it will put the RBI in a policy dilemma. On the one hand, there have been demands from industry to cut rates. A rate hike by the Fed will force the RBI to rethink on rate cuts. A rate cut will make rupee debt less unattractive as compared to dollar denominated debt. This may force the RBI to put off rate cuts for the time being. With credit flow down to a trickle, the RBI will have a trying to convince the finance minister why they can’t cut rates. As for industrial credit, that will surely take a back seat. To cut a long story short, a rate hike by the Fed could have serious implications for India. One hopes that the Fed may reconsider its decision to hike rates due to pressure from the American exporters. But for a nation that has long focused on a strong and resilient dollar that may not exactly be the prime consideration. India surely has reason to worry if the Fed continues to hike rates.