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Policy Of
Exchange Rate Maskey's
book discusses various aspects of exchange rate policy of Nepal in the backdrop of Indian
currency By KESHAB
POUDEL Exchange rate
policy is the important factor of economic development policy but little efforts have been
made to analyze it. Nepal has a long history of exchange rate policy but it has not been modified
to meet the demands of changing time. Nepal's monetary policy has been heavily influenced
by the Indian exchange rate. The establishment of Nepal Rastra Bank in 1956 was a historically important
step which paved the way for the initiation of new exchange rate policy. Nepal still follows two levels of exchange rate policy. It has exchange rate
peg vis-a-vis the Indian currency with seven adjustments in the NC-IC exchange rate. For
other convertible currencies, exchange rate is determined by currency basket system. At a time when there is a debate over the need to review Nepal's current
exchange rate policy adopted by the country, Maskey's book analyses the present situation. Maskey holds the view that Nepal needs to review its exchange rate policy
with India and should treat Indian currency as other convertible currencies. He argues that Nepal's exchange rate relations with foreign currencies other
than the Indian currency have undergone transformations from a rigid exchange rate policy. In the context of globalization and more integration with other South Asian
countries, Nepal needs to review its currency policy. Although the book is very small, it includes a thorough analysis and data
regarding the present monetary situation. Maskey describes historical and other important aspects of Nepalese monetary
policy to prove his argument that the time has come to review the existing monetary
policy. It seems very sound in the sense of diversification of Nepalese trade but it
is not easy in the sense of geographical proximity with India. Maskey's argument is
theoretically very sound but could be practically suicidal for Nepal in the long run. The
Exchange Rate Policy of Nepal South
Asian Vision It
is a compilation of proceedings of a seminar but highlights important debates South Asian
region is full of diversity in terms of culture, religion, language and politics. This is
why it is regarded as a unique region in the world. Understanding the necessity to join hands with each other, the countries of
the region have formed South Asian Association of Regional Cooperation (SAARC) more than a
decade and half ago. But, it is yet to fully materialize the dream. The collection of the articles in the book shows what are the challenges as
well as opportunities in the South Asian region. Although it is based on proceedings of a regional seminar, the book has many
interesting topics to study which will help understand the regional perspective on issues
of peace, security, cooperation, economic development, social justice and culture and
media cooperation. From the opinion of former Indian Prime Minister I.K. Gujral to former
Nepalese Prime Minister Krishna Prasad Bhattarai, the articles in the book try best to
explain the importance of regional conference. The
Kathmandu Statement, 1999 |
Send your feedback to the
editor: spotligh@mos.com.np |
