The only country that damns its own currency

In July 2010, India joined the ranks of the major currencies of the world by adopting a symbol for the rupee - an elegant blend of Devanagari and English alphabets with attributes of the tricolour represented in the two lines at the top and white space in between.

The rupee symbolises the strength of our economic system and our rising financial prowess, acknowledged and admired the world over.Yet, what the Indian rupee represents is undermined by an irrational policy.

The rupee becomes unusable in a certain area: the protected environs of duty free shops at our international airports, where the memorable phrase, “Show me the money”, acquires a whole new meaning. An Indian national can buy what he or she wants up to a maximum of Rs5,000 in Indian currency. But a foreign national cannot use Indian rupees. You can shop till you drop, but when it comes to paying, pick up a credit card or foreign currency.

I don’t think there is another nation that disregards its own currency as we reject the rupee on our territory. At international airports, prices are marked in local currencies and paid for in local currencies. Among the great and small nations, we are the only nation that gives short shrift to our own currency and refuse to accept the rupee as a form of payment.

For foreign tourists, Incredible India turns into incredulous India when after a memorable stay in our country, they are told the rupees are not good enough at the airport duty free shop. Imagine the irritation of travellers who have set aside a few hours and a few thousand rupees to take back tangible memories of India. The Indian currency in their hand cannot pay for the goods they buy.

They have to change their Indian rupees into foreign exchange by paying a commission, a double whammy since they would have paid a commission while converting their foreign exchange into Indian rupees at the time of arrival. Instead of being able to spend it freely at the point of departure, they have to convert it before spending it.

How does this serve us in if the foreign traveller decides against shopping because she cannot use the Indian rupees in her wallet? What is the policy compulsion behind such a practice? When foreign tourist and business travellers spend money in India, on their stay, food and shopping, it flows into our economy. Why does the colour of money become an issue in the hands of a foreign national at an international airport? An Indian rupee is being spent in India. What is the harm in that?

At a time when we are building state-of-the-art airports with facilities and services comparable to the best in the world, this law is outdated. India is likely to emerge as an important hub in the years to come and it makes enormous economic sense to take this one simple step to make the entire visiting experience a pleasant one for tourists and business travellers.

There are many international airports that are marketed as the ultimate shopping destination for travellers. We are not in the same league yet but if we want to get there, we should review our policies. If we don’t change our attitude we will lose an important source of revenue, as sales at some of the best duty free shops run into billions of dollars, sorry, thousands of crores of rupees annually.

India is a trillion dollar economy, growing at close to 9%, with foreign exchange reserves of almost $300 billion. As a country confident of our economic ability, we should allow the use of Indian rupees at duty free shops. This step will be in line with our recent adoption of the rupee symbol; it will increase the visibility of our currency and enhance its distinctive identity.

When Sher Shah Suri introduced the first rupee in the early part of the 16th century, he could not have imagined that 500 years later, our currency would not hold sway in some parts of our sovereign territory. It took me five years to get the rules changed so that Indian citizens can use rupees at airport duty free shops, a change that was notified in September 2005. I hope it doesn’t take that that long to get this policy struck off the rule book.

The writer is a member of Parliament representing the Kurukshetra constituncy in Haryana