Currency union in south Asia beyondbrics reader: Viewed from an economic standpoint (beyond any existing diplomatic rifts) would a common currency with Pakistan, Bangladesh and Sri Lanka, be useful to India? Duvvuri Subbarao: From an economic point of view, a common currency should certainly be beneficial for regional trade and be cost effective too.
However, for benefits to accrue, intra-regional trade has not only to be large but has to constitute a significant proportion of each country’s global trade. This is not the case presently. We are nevertheless actively exploring regional financial arrangement (RFA) options like the Chiang Mai Initiative (CMI). Economic co-operation among SAARC nations is based on our shared aspiration for growth and poverty alleviation.