Myanmar and India need to settle payment woes, says UMFCCI
MYANMAR’S rigid banking system is restraining trade potential with India, one of the country’s largest trading partners, according to senior officials at Myanmar’s peak business bodies.
U Myo Thet, vice president at the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI), told The Myanmar Times last week that many Indian traders wanted to deal in rupees, which delayed payment as local traders needed to settle in US.
“We have a lot of challenges with the India rupee, especially when
UMFCCI vice president
transferring money for payment,” he said. “So we face delays in settling. The issue is a big challenge for us.”
A history of currency instability and complex trade sanctions means that a lot of foreign exchange transactions relating to international trade with Myanmar are completed offshore.
U Myo Thet said the issue of rupee exchange had been raised with the previous government. He expressed hope that the new NLD-led government might be able to negotiate through its diplomatic ties to find a more accommodating solution with their Indian counterparts.
Rohinton Engineer, vice president of the Indo-Myanmar Chamber of Commerce and Industries, said as soon as the three Indian banks waiting to establish a foothold on Myanmar were granted access, trade would likely improve.
“We can do this process quickly, as soon as the Myanmar government gives banking licences to India Banks,” he said.
According to figures from the Ministry of Commerce, in the 2015-16 fiscal year trade between India and Myanmar was valued at US$1.7 billion. India is the third-largest among Myanmar’s border trading countries.
‘We have a lot of challenges with the India rupee, especially when transferring money.’
U Myo Thet