It didn't exactly play out as feared. The consensus on Wall Street among the major strategists was that the Fed scaling back on its massive quantitative easing would trigger a crisis in places such as India, which suffered from weak fundamentals that had been masked for years by a flood of liquidity and hot money inflows thanks to QE.
One noted crisis expert, Carmen Reinhart of Harvard University told CNBC last August in Jackson Hole, Wyoming, "the probability of a banking crisis, currency crash and default all increase" for emerging markets after the capital flow bonanza ends.
But so far, the taper tantrum has been mild in 2014, and the hot money has continued to flow into India and the rupee.
That gets to the final point about India and emerging markets' currency strength this year: That is, expectations were pretty low, and the trade was looking crowded. Nobody liked emerging markets heading into the new year, with slower growth, higher inflation, rising deficits and the risk of tapering.
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Goldman Sachs told investors at the beginning of the year to cut allocations in emerging markets by a third for stocks, bonds and currencies over the next decade.
Those expectations and doom and gloom proved to be misguided, or at least exaggerated, because since then the Indian stock market, the Sensex, has risen to a record high.
Foreign institutional investors poured into Indian stocks during the first quarter, and the rupee strengthened.
So is it too late to buy?
Strategists say if Modi is indeed voted prime minister, that will open opportunities for investment in a traditionally tricky, bureaucratic economy for foreign direct investment. So the future for the rupee looks bright, unless fear of higher rates in U.S. grips markets again, or if the U.S. economy outperforms fast enough for the Fed to consider raising rates.
But for the moment, that doesn't look imminent.
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Kit Juckes, forex strategist at Societe Generale, sums it all up: "With political uncertainty set to go away after the elections, presumably, we'll get more inflows to finance the current account deficit…The global environment is EM-friendly and with central bank credibility in good shape the INR can ride a global risk-friendly wave."
—By CNBC's Sara Eisen.