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 The Indian rupee has experienced a historic decline in value against the dollar.

The dollar hit its highest level since 2002 on fears of a further devaluation of the rupee and a weaker pound.

According to the British news agency Reuters, the dollar reached around 81.30 Indian rupees on Monday, compared with 80.9900 Indian rupees earlier.

According to traders, the Indian rupee hit a record low of 81.2250 against the dollar on Friday, prompting the Reserve Bank of India (RBI) to sell dollars. Due to RBI's intervention, there was some improvement in the value of the rupee.

"It will be a tough and volatile session," said a trader at a Mumbai-based bank, hinting at RBI's intervention through state-owned banks. All eyes will be on general government banks as soon as the market opens.

"RBI's intervention at 81.20 was quite strong and markets will want to know if this level will be secured again," he said. But the RBI may not be too inclined to intervene given the volatility of Asian currencies.

Notably, the dollar index rose above 114.50 in Asia trading, the highest since May 2002, thanks to a falling British pound.

Fears over the new government's economic plan in the UK have sent the pound into historic decline.