Please enable JavaScript.
Coggle requires JavaScript to display documents.
Rupee as Global Currency - Coggle Diagram
Rupee as Global Currency
Purpose of having forex reserves
Protection in case of volatility
It has to serve as a medium of exchange, a store of value, and a unit of account
Reserves of about $12 trillion across 150 countries
What Is a Reserve Currency?
To influence their domestic exchange rate
Gold and oil, are priced in the reserve currency, causing other countries to hold Rupee
Currency for for investments, transactions, and international debt obligations
Steps India would require to take
Offshore corporate rupee borrowing
Roll out CBDC (central bank digital bank currency)
Advocate rupee invoicing
Take payment networks to a global level
Full capital account convertibility
Evolving monetary and economic policy along with institutional reforms
Raise tax to GDP ratio
How it will help India?
Privilege of lower real interest rates
Edge over China's Renminbi
It indirectly aligns fiscal, monetary, and economic policy