A groundswell of opinion has been developing to support a single global currency for decades. With a single global currency, prices worldwide would be denominated in the same unit and could be easily compared. This integration would lead to reinforcing the hegemonic control of a small number of global banking and financial institutions over the process of money creation. This, in turn, would overshadow the functions of national central banks, encroach on the sovereignty of the Nation State, and eventually lead to a new phase of the global debt crisis. Another side of the fact is that a global currency based on the existing IMF’s Special Drawing Rights (SDRs) arrangement would not fundamentally change the international monetary order.

Indian economy is recovering faster than expected and is consistently getting broader based. According to the World Bank’s South Asia Economic Update, India’s economy will grow 8-9 percent over the next two years. However, inflation, rising interest rates, small appreciation in the rupee, and continued low growth in high-income countries could weigh on the recovery. Risks to the outlook come from volatility in capital inflows, staggering global recovery, and inflation shocks. Staggered recovery in high-income developed nations might also adversely affect trade prospects and hit remittance inflows; however, growth prospects remain optimistic.

Indian economy has raised the issue of greater internationalization of the Indian rupee, and India needs to proactively take steps to increase the role of the domestic currency in the region. Internationalization of the rupee would also require India to make the rupee fully convertible.