Rupee and Taka to replace Dollar as currency of exchange between India, Bangladesh

[Black_cats]

Rupee and Taka to replace Dollar as currency of exchange between India, Bangladesh​

Bengaluru, IndiaEdited By: Mukul SharmaUpdated: Mar 04, 2023, 07:39 PM IST

India's finance minister Nirmala Sitharaman and Bangladesh Commerce Minister Tipu Munshi | file | @nsitharaman PhotographTwitter)

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STORY HIGHLIGHTS​

India-Bangladesh Rupee-Taka arrangement: India is among the top three import destinations for Bangladesh. The arrangement will first be rolled out on a trial basis before a wider implementation for the people of the two South Asian neighbours.

India and Bangladesh may soon do away with dollar as the currency of exchange between two two South Asian neighbours. The development is expected to reduce the cost of trade as well as losses due to Rupee-Dollar and Taka-Dollar differences.

The latest bilateral deliberations between India and Bangladesh took place on the sidelines of the G20 finance chiefs meeting held in the southern Indian city of Bengaluru on February 24-25, Bangladesh's Daily Star newspaper reported.

The report, while citing Prime Minister Sheikh Hasina government's estimates, adds that every year, Bangladeshi nationals spend about $2 billion on treatment, tourism and education in India. India is among the top three import destinations for Bangladesh.

India-Bangladesh ties: Soon, a dual currency card may become a reality​

For Indians and Bangladeshis visiting each other's countries, they would have a dual currency card that they can load with Indian rupees or Bangladeshi Taka before travelling.

Reports in the Bangladeshi media say that the exchange rate would be derived from the two currencies and not be worked backwards from the exchange rate of the dollar.

The Daily Star newspaper reported that the matter of Taka-Rupee bilateral exchange and dual currency card was brought up at a meeting of Bangladesh's National Economic Council chaired by Prime Minister Sheikh Hasina
At the meeting, Bangladesh Bank Governor Abdur Rouf Talukder reportedly said that the move would also reduce the pressure on foreign currency given the large volume of payments to India.

"The pressure on reserves has come down a lot. The import bills have come down because of the measures taken. It is now possible to meet the import bills with the export proceeds and remittance inflows. But there are other dollar outflows that need to come down."

The rollout will first take place on a test basis, before a formalisation of the process for the public by the public sector banks of the two countries.

(With inputs from agencies)

 

[mb444]

If india is prepared to be completely transferable with Taka then great, it will lay the foundation for a future south asian common currency.

 

[Skull and Bones]

If india is prepared to be completely transferable with Taka then great, it will lay the foundation for a future south asian common currency.

BDT can be pegged at 1 INR is 1.3 Taka, INR and Nepalese Rupee is running stable at 1:1.6 since I was a kid. One can go to Kathmandu and do transactions in Indian rupee.

 

[Kaniska]

If india is prepared to be completely transferable with Taka then great, it will lay the foundation for a future south asian common currency.

I think, we have similar kind of arrangement with Nepal where the Rupee can be used.

 

[Thevilone]

BDT can be pegged at 1 INR is 1.3 Taka, INR and Nepalese Rupee is running
stable at 1:1.6 since I was a kid. One can go to Kathmandu and do transactions in Indian rupee.

I am Indian and I don't think its fair. INR to Taka has been flucatuating for long between 1.1 to 1.3. As much as I would love to see a relatively stable exchange rate, 1.3 seem very unstable because it just can not last. An artificially high rate would kill exports just like Dar's 200PKR to 1USD killed Pakistan's exports and economy.Let's learn from the failures in our negibourhood and try for a sustainable and respectful economic interaction between India and BD.

 

[Skull and Bones]

I am Indian and I don't think its fair. INR to Taka has been flucatuating for long between 1.1 to 1.3. As much as I would love to see a relatively stable exchange rate, 1.3 seem very unstable because it just can not last. An artificially high rate would kill exports just like Dar's 200PKR to 1USD killed Pakistan's exports and economy.Let's learn from the failures in our negibourhood and try for a sustainable and respectful economic interaction between India and BD.

You have a point.

 

[my2cents]

I am Indian and I don't think its fair. INR to Taka has been flucatuating for long between 1.1 to 1.3. As much as I would love to see a relatively stable exchange rate, 1.3 seem very unstable because it just can not last. An artificially high rate would kill exports just like Dar's 200PKR to 1USD killed Pakistan's exports and economy.Let's learn from the failures in our negibourhood and try for a sustainable and respectful economic interaction between India and BD.

1:1 is fair with Bangladesh. They are at par with us in per capita income and have stable economy and comfortable foreign reserves.

 

[bluesky]

1:1 is fair with Bangladesh. They are at par with us in per capita income and have stable economy and comfortable foreign reserves.

There are many variables that decide the value of a currency, and the variables keep on changing as economic fundamentals may keep changing.

It is difficult to get rid of the connection with dollars the international currency. And I personally do not think these two countries should go after a common market.

 

[my2cents]

There are many variables that decide the value of a currency, and the variables keep on changing as economic fundamentals may keep changing.

It is difficult to get rid of the connection with dollars the international currency. And I personally do not think these two countries should go after a common market.

Dollar will be relevant as long as usa is a preeminent power and a consumer of 25% of world output. In future China will reach that position and then India in that order. For bilateral trade we don't need dollars if trade is in equal footing. We just have import more from BD to do that.

 

[mb444]

The rate can fluctuate ....it is transferability that matters.

Trade is 10:1 in favor of india as such BD simply wont have enough INR. However if TK and INR are simply transferable it wont matter. It will massively increase trade in both direction.

As i said it will lay the future of a future south asian common currency.

 

[Imran Khan]

If india is prepared to be completely transferable with Taka then great, it will lay the foundation for a future south asian common currency.

south asian common currency.??????????????????????????

better term is bangladesh nepal bhutan india sri lanka moldives common currency .

 

[Skimming]

better term is bangladesh nepal bhutan india sri lanka moldives common currency .

Why don't you simply say 'South Asia barring Af-Pak'?

 

[mb444]

better term is bangladesh nepal bhutan india sri lanka moldives common currency .

No... PK has no monopoly on the term south asia...plus do you people not believe you are are part of central asia?

 

[Imran Khan]

No... PK has no monopoly on the term south asia...plus do you people not believe you are are part of central asia?

well as per every world body UNO world bank ICJ WTO WHO IAEA ect pakistan is part of south asia .

Why don't you simply say 'South Asia barring Af-Pak'?

pakistan is part of south asia .
you can take afghanistan too if taliban want to join you .

 

[Species]

Not sure if it's a wise thing to do right now. There could be requests for similar arrangements from China which the US wouldn't like.