| Date: |
06-11-2015 |
| Subject: |
RBI puts a stop to barter trade on Indo-Myanmar border |
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KOLKATA: Indo-Myanmar border is perhaps one of the few places on the earth where barter trade still exists.
With the improvement in banking presence in the border, the Reserve Bank of India has now decided to officially stop the barter system, which is trading of goods without exchange of money.
The system will be discontinued from December 1, RBI said in a notice.
"Over a period of time the trade basket has diversified and adequate banking presence is in place to support normal trade with Myanmar," the central bank said. "It has, therefore, been decided, in consultation with Government of India, to do away with the barter system of trade at the Indo-Myanmar border and switch over completely to normal trade."
All trade transactions with Myanmar, including those at the Indo-Myanmar border with effect from December 1, 2015 would be settled in any permitted currency.
India and Myanmar agreed to allow barter trade of 22 items such as fruits, onion and bamboo. These are mainly locally produced commodities including agricultural and minor forest products.
Trading of goods without the exchange of money has been allowed all these years to facilitate exchange of commodities such as mustard, pulses and fresg vegetables along the Indo-Myanmar border. This was allowed in parallel to normal trade in exchange of money or under the letter of credit system as per export-import policy guidelines.
Source : economictimes.indiatimes.com
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