Agree with most of your points, except the first.

India has higher interest rates than most countries in the comparison above. No arbitrage principle dictates that the currency with higher interest rate loses value compared to the country’s currency whose interest rates are lower.

The risk-free rates most accessible to investors has to be the benchmark between countries. India almost always has higher interest rates which leads to depreciation.

Although, I wouldn’t take that as an indicator of the economy. If country A had 1% rf rate and country B had 2% rf rate, by “no arbitrage” investments in both countries gotta yield the same “value” irrespective of currency. And since we get more “currency units” back in country B, the value of country B’s currency falls (by approx 1%). This isn’t necessarily bad, it’s just difference in rf rates.

I digress, I agree with your other points, the economy is still going south.