Rangaraj Srinivasan writes: The value of the rupee hit an all time low of 68.85 on August 2013. The government and Reserve Bank of India mulled over about currency swap arrangements with its trade link countries during September 2013.Usually, India is using US dollar as its medium of exchange for its exports and imports of its goods and services like most of the other countries in the world. Currency swap arrangements refer to exchanging of their own currencies of countries for their trades instead of universally accepted currency like USD. Suppose India has export and import arrangements with Malaysia. India will receive ringgit for its exports to Malaysia and remit rupee for its imports from Malaysia.

India could get crude oil at lower rates, when it was importing crude oil from Iran by exchanging the rupee and other countries currencies instead of US dollar, based on the situation.
However, when US compelled India to reduce its crude oil imports from Iran due to her differences with Iran over the nuclear issue, India cut its imports from Iran, and she increased its imports from Iraq and Latin American countries at higher rates by paying the amount in US dollar.

Iran was about to send gas to India through pipelines via Pakistan at cheaper rates. However, it was not possible for India due to compulsions of the United States.

Above said reasons also widened current account deficit.

When India is not able to resume trades with Iran due to these global reasons, the government and RBI should at least think of currency swaps with some other countries currently at the time of the rupee devaluation.
Industry experts say that India has potential of 40 gold mines in India. At present, there are only 3 mines in India (two mines in Karnataka and one in Jharkand).

Industry experts say that India has potential of 40 gold mines in India. At present, there are only 3 mines in India (two mines in Karnataka and one in Jharkand).
The finance ministry has suggested about the creations of new gold mines in India to the mining ministry during the last fiscal.

If this suggestion is executed, I think that there is a possibility of a little bit of narrowing down of current account deficit in turn the rupee may get some appreciation in its value.

By V.R.SRINIVASAN,

SENIOR DEALER IN A STOCK BROKING CONCERN

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