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Wanted: Some prudence & a lot of foresight

Currency arrangements need to be thought through carefully lest India is left holding dues against partner countries

Jyoti Mukul

As economic affairs secretary in the ministry of finance, Manmohan Singh had signed a protocol with the then Union of Soviet Socialist Republics on November 25, 1978, laying the foundation of a currency arrangement between the two countries that lasted 15 years till 1993. The arrangement was applicable to all commercial and credit transactions. The Indian rupee was valued at 10 to a rouble. It was linked to a basket of 16 currencies including the dollar and more than 3 per cent change in the rupee value to this basket on any day was to accordingly reflect in the rouble-rupee exchange ...