@ AvNavCom: This DGCA circular is complete news to me! I have never seen it before in my life. Gotta love them eh? But this does not mention anything about instrument flying. All it talks about is being generally current to fly an aircraft in line with VFR.
@Jimmygill: That is what I have heard from other sources as well. That it doesn't make sense to do the IR renewal if you are not actively flying those particular planes. However quite a few people still believe that having currency improves your chances of getting a job with the airlines. How much of truth is there to that? You already mentioned that it doesn't really make much of a difference but it would be nice to know the background behind it.