India-Bangladesh to negotiate upon Free Trade Agreement -

New Delhi: A discussion was held between the trade ministers of India and Bangladesh on the free trade agreement between both countries. Negotiations between the two countries will start soon. Simultaneously, it is reported that Indian Commerce Minister Piyush Goyal and Bangladesh Commerce Minister Tipu Munshi have discussed conducting trade between the two countries in Indian Rupee. At the same time, there are reports that the two countries have agreed to use the Indian Rupee for trade between Sri Lanka and Russia. Therefore, the international transactions of the Rupee would augment. Besides, as per the indications, the importance of Rupee as a global currency will increase.

Moreover, bilateral trade between India and Bangladesh crossed $18 billion in the fiscal year 2021-22. It has increased by eight billion dollars compared to the previous financial year. A report examining the feasibility of a free trade agreement between the two countries (Comprehensive Economic Partnership Agreement-CEPA) was released recently. India’s Ministry of Commerce informed that it had been concluded that both countries would get many benefits from the free trade agreement. Due to this free trade agreement, the products of both countries can be freely available in each other’s countries. Moreover, the Ministry of Commerce claimed that this may increase the flow of investment in both countries.

Against this background, the trade ministers of India and Bangladesh agreed to start negotiations on the free trade agreement. It will greatly benefit bilateral trade. It is reported that the commerce ministers of both countries also discussed using the Indian Rupee for this trade. India and Bangladesh can also get a huge benefit from this. The outbreak of Coronavirus and the subsequent Ukraine conflict has also affected Bangladesh’s economy. In such a situation, if Bangladesh gets the concession to trade in Indian rupees without spending its reserve dollars, it will benefit the country’s economy.

Furthermore, the US started using the dollar as a weapon to teach Russia lessons after the conflict in Ukraine. Taking a lesson from that, Russia, China, and other countries have also taken a strategic decision to reduce their dependence on the dollar. Some countries have taken the initiative to do business with countries like Russia and China in their own currencies, and the importance of the Indian Rupee is also increasing. After India and Russia took steps to transact in Rupee-Ruble, some other countries took the initiative. It has become clear during the visit of Commerce Minister Tipu Munshi to India that Bangladesh has shown its readiness for this.

While the news is coming in, Sri Lanka has also prepared to trade in the Indian Rupee for trade with Russia. Russia and Sri Lanka are said to have agreed on this. The Reserve Bank has not yet approved this. But soon, this process will be completed and the Rupee will be used for transactions between Russia and Sri Lanka. It is claimed that if India uses rupees instead of dollars for trade with other neighbouring countries except for Pakistan, it will save India $35 to $40 billion annually. India has prepared for this and has further received responses from other countries.

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