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South Asia not ready for common currency
(Daily Star/ANN) South Asia is not yet ready for a common currency, said economists from countries in the region at the opening of a two-day 14th South Asia Economic Summit in Sheraton Dhaka on Saturday.
However, integration in trade and investment, increased mobility and people-to-people connectivity will provide the incentive for monetary cooperation in the region, they told a session on macroeconomic cooperation and the possibility of a common currency.
South Asia accounts for nearly one fourth of the global population and it has the market and ability to grow together, said the economists at the event being hosted by the Centre for Policy Dialogue.
Yet it is the least integrated in terms of trade, said Zahid Hussain, former lead economist at The World Bank, Bangladesh.Intra-regional trade accounts for 5 percent of South Asia’s total trade whereas the share of intra-regional trade in the Association of Southeast Asian Nations (Asean) region is 25 percent, he said.
South Asia is diverse in land area, gross domestic product or economic output, and population but the region’s countries have similar levels of human and economic development which calls for increased integration, he said.However, there is a lot of barriers to mobility, he said, citing non-tariff barriers, complicated visa policies and rigid bureaucracies.
“There is high sensitivity to national sovereignty. National currencies evoke strong attachment and emotion,” said Hussain at the event.
Political will to give up fiscal and monetary autonomy is also necessarily to go for a common currency, he said.
Complementarity in trade and free flow of labour and capital among the members can make cooperation over a currency more likely, he said.
Several countries have taken steps to reduce dependence on the US dollar and Bangladesh also took bilateral initiatives to settle trade in Chinese yuan and Indian rupee in 2022 and 2023, said Hussain.
However, the response with regard to trade in rupee is muted while exporters in China prefer receiving payments in dollars, euro and pound sterling, he said.There is persistent and growing trade deficit among Bangladesh, China and India, which makes trade in rupee and yuan limited here, he said.
Bangladesh’s average monthly trade deficit is $1.13 billion with China and $644 million with India.Comparability of economies is needed for a common currency, said Md Habibur Rahman, chief economist at Bangladesh Bank. “We are not right there…We can search for an appropriate time and opportunity for this,” he said.
A mechanism enabling independence is needed to avoid sanctions, said Abid Qaiyum Suleri, executive director at Sustainable Development Policy Institute, Pakistan.
Pakistan is relying on barter trade with countries such as Afghanistan, China and Russia, he said.
“Instead of losing hope on a common currency, we can explore so that we reduce dollar dependence,” said Suleri.
Posh Raj Pandey, senior economic advisor of the finance ministry of Nepal, proposed for establishing a regional financial market in this regard.
Use of the US dollar for international transaction settlement is declining, said Professor Sachin Chaturvedi, director general of the Research and Information System for Developing Countries, India.
International transactions other than that of the US dollar accounted for 9 percent of total global trade in July 2022 and it rose to 14 percent in December the same year, he added.
“This is an indication of rising arrangement of settlement in non-dollar,” he said, adding that 38 countries have shown interest to trade with India in rupee.
However, to make trade in the rupee popular between Bangladesh and India, a large line of credit in rupee is needed, said Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh.
“Otherwise, the performance we have seen is dismal…We also should think of currency swap to protect against external shock,” he said.
Countries should start with trade facilitation for economic integration and go for common documentation for customs, encourage firms to invest regionally and foster people to people connectivity, said Mansur.
Visa issuance and border control is quite pervasive and old fashioned, he said.
The economist also suggested harmonisation of tax and trade policies among members of the South Asian Association for Regional Cooperation.
“We also need monetary policy harmonisation. We need to think about bringing inflation close to each other and currency stability. Cooperation at the institutional level is critical,” he said.
News
Urgent reforms needed to eradicate drug menace, says President
President Anura Kumara Dissanayake has instructed officials to swiftly introduce all necessary reforms, including amendments to existing laws, in order to eliminate the drug menace from the country.
The President issued these instructions while attending the meeting of the “Ratama Ekata” National Steering Council convened on Thursday (07) morning at the Presidential Secretariat to discuss efforts aimed at eradicating the drug menace.
He also directed the relevant authorities to take all necessary steps to expedite the process of destroying seized narcotics as quickly as possible under proper legal procedures, thereby preventing them from re-entering society and to accelerate the process of punishing offenders.
The President emphasised the need to speed up this process in order to build public confidence, as well as the confidence of the teams engaged in operations, noting that the successful implementation of the “Ratama Ekata” national initiative would thereby be strengthened through collective participation.
The progress of anti-narcotics operations carried out under the “Ratama Ekata” national initiative, including raids and arrests, was extensively reviewed at the meeting. Officials pointed out that raids related to narcotics had increased by 80% since the launch of the programme.
Since the launch of the “Ratama Ekata” national operation on 30 October 2025, authorities have seized 5,437.457 kilogrammes of cannabis, 1,936.325 kilogrammes of heroin, 1,991.414 kilogrammes of crystal methamphetamine (“ice”), 271.724 kilogrammes of cocaine, 1,574,895 narcotic pills, and 629,988 illicit cigarettes. A total of 168,460 suspects have also been arrested in connection with these offences.
The current progress of the legal amendments required to eradicate the narcotics menace from the country was reviewed at the meeting, and it was noted that steps had been taken to submit the Rehabilitation (Amendment) Bill No. 54 of 2007 to the Cabinet in due course. Discussions were also held regarding the rehabilitation process, the strategies that could be adopted in that regard, and the measures taken to develop related facilities.
It was further revealed that, at Divisional Secretariat level, 25 families most severely affected by narcotics in each division had been selected for attitude development programmes. The President stressed the importance of implementing all such programmes through local religious centres.
The President also made clear that anti-drug awareness programmes should not merely be limited to conducting awareness campaigns, but should include continuous follow-up to assess whether the message had been properly communicated to society and to monitor progress. He highlighted the importance of maintaining this mechanism continuously with the involvement of religious leaders, including members of the Maha Sangha in the respective areas.
The President also inquired into measures being taken to establish a separate court for narcotics-related cases, expedite the receipt of Government Analyst reports, and accelerate the filing of cases.
He also stressed the urgent need for a rapid programme to expedite legal proceedings and rehabilitation processes concerning inmates imprisoned for narcotics-related offences, in order to ease prison overcrowding.
The Inspector General of Police also briefed the meeting on investigations and the current status relating to Buddhist monks who were recently arrested in connection with narcotics offences.
The President was further briefed on the progress of programmes jointly implemented by the Ministry of Education and the Women and Children’s Bureau to curb organised efforts to draw schoolchildren into narcotics use. He was also informed about community-based programmes planned in conjunction with the International Day Against Drug Abuse and Illicit Trafficking, which falls on 26 June.
Among those present at the meeting were the Anunayaka Theros of the Malwathu and Asgiri Chapters, senior clergy representing several Buddhist Nikayas, Christian priests, Hindu Kurukkals, Muslim religious leaders, senior government officials including Secretary to the President Dr Nandika Sanath Kumanayake, ministry secretaries, senior tri-forces commanders, Inspector General of Police Priyantha Weerasooriya, heads of relevant institutions, senior security officials, and representatives of the “Ratama Ekata” National Steering Council.
[PMD]
Latest News
Warm welcome extended to the President of the Socialist Republic of Vietnam at the Presidential Secretariat
The official welcoming ceremony for the President of the Socialist Republic of Vietnam and General Secretary of the Central Committee of the Communist Party of Vietnam, To Lam, who is on a State visit to Sri Lanka at the invitation of President Anura Kumara Dissanayake, was held this morning (08th May 2026) at the Presidential Secretariat under the patronage of President Dissanayake.
President To Lam is undertaking this State visit with the aim of further strengthening the economic, cultural and social ties between Vietnam and Sri Lanka.
Upon his arrival at the Presidential Secretariat, escorted by the Police Mounted Division, President To Lam was warmly received by President Anura Kumara Dissanayake.
Following the playing of the national anthems of both countries, the official welcoming ceremony for President To Lam formally commenced.
On the occasion, President To Lam was accorded a ceremonial gun salute with full State honours.
Thereafter, President To Lam and President Anura Kumara Dissanayake reviewed the Tri-Forces Guard of Honour, following which the Vietnamese and Sri Lankan delegations were introduced.
The two leaders also posed for official photographs.
Representing the Government of Sri Lanka at the occasion were Minister of Foreign Affairs, Foreign Employment and Tourism Vijitha Herath, Minister of Labour and Deputy Minister of Finance and Planning Dr Anil Jayantha Fernando, Minister of Science and Technology Professor Krishantha Abeysena, Minister of Buddhasasana, Religious and Cultural Affairs Dr Hiniduma Sunil Senevi, Minister of Environment Dr Dhammika Patabendi, Minister of Public Security and Parliamentary Affairs Ananda Wijepala, Secretary to the President Dr Nandika Sanath Kumanayake, Secretary to the Ministry of Defence Air Vice Marshal Sampath Thuyacontha (Retired), Secretary to the Ministry of Foreign Affairs Aruni Ranaraja, along with a number of senior officials from both countries.
(PMD)
Latest News
President of the Socialist Republic of Vietnam arrives in Sri Lanka on State Visit
President To Lam, President of the Socialist Republic of Vietnam, General Secretary of the Central Committee of the Communist Party of Vietnam, accompanied by a delegation of 209 members arrived in Sri Lanka on Thursday (07) night on a state visit.
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