However, it seems to me that market integration in Asia is moving forward autonomously through trade and foreign direct investment by the private sector, that is to say, through “bottom-up integration”. In light of this, central banks in Asia are working together in promoting regional monetary cooperation to develop deep financial markets. The Bank of Japan also contributes to these undertakings.
In terms of money-based indicators, the proportion of net foreign exchange assets of RBI (NFA) to currency with the public has sharply increased from 15 per cent in 1991 to 109 per cent as at end-March 2002. The proportion of NFA to broad money(M3) has increased by more than six fold; from 3 per cent to 18 per cent.