Thursday, 28 September, 2023

Taka-rupee trade set to begin in July

  • Staff Correspondent
  • 25 June, 2023 12:00 AM
  • Print news
Taka-rupee trade set to begin in July

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A new chapter in international trade between Bangladesh and India is set to unfold as the two countries have announced the commencement of trade in local currencies from July.   

This development comes after a decade of deliberations and is aimed at strengthening economic ties.

The service is scheduled to be inaugurated virtually on July 11 by Bangladesh Bank Governor Abdur Rouf Talukder and Reserve Bank of India Governor Shaktikanta Das. SBI Chief Executive Officer CS Shetty will also join the virtual inauguration.

According to reports, state-owned Sonali Bank and private lender Eastern Bank from Bangladesh have received authorization from the central bank to engage in this trade. In India, State Bank of India and ICICI Bank have been appointed as correspondent banks. These institutions will maintain cross-currency accounts to facilitate transactions.

Dr. Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue (CPD), lauded the initiative as a positive step in bolstering economic ties between the two nations.

“It’s a beginning. The impact will come gradually. The initiative will help in maintaining the good health of reserves. Our reserves are on a good portfolio now,” he told Daily Sun.

Former Chairman of the Association of Bankers Bangladesh, Anis A. Khan, also welcomed the move, emphasizing its potential in opening new avenues for businesses through trade in Taka and Rupee. He also noted that this would alleviate pressure on dollar reserves.

Bangladesh and India share a robust economic partnership, with India being Bangladesh's largest development partner globally and the largest trading partner in South Asia.

Bilateral trade has witnessed substantial growth, escalating from $7 billion to approximately $18 billion over the past five years. This new currency trade initiative is expected to further augment this thriving relationship.