“Dinar nahin to dollar chalega
Kameez nahi to kameez ka collar chalega.”
(If not the dinar, the dollar would do
If not the whole shirt, the collar would do)
I was thinking of these telling lines from a hit 1968 Hindi song “Tujh ko rakkhe Ram tujh kl Allah rakkhe” (May Ram protect you, May Allah protect you) from the movie ‘Aankhen’ (Eyes) written by the redoubtable Sahir Ludhianvi and composed by Ravi.
The immediate provocation for remembering the lines is America’s decision to reimpose its economic sanctions on Iran over its suspected nuclear program and the predicament it puts India all over again. Iran is a major source of oil for India and the severe trade and currency settlement restrictions that the sanctions entail are a major problem for New Delhi.
At the height of the first round sanctions in 2012, I wrote a post on May 9 of that year headlined “Can Iran convert its rupee cash?” In that I wrote, “The Indian genius for jugaad or ingeniously crafted solution of a difficult situation is on full display in the country’s dealings with Iran.
As Tehran continues to pursue its nuclear program in the face of the crippling US-led international sanctions, which specifically disallow dollar and euro transactions, India and Iran have found a way out.
The news that India pays 45 percent of its Iranian oil import bill in rupees to get around the sanctions is old and well-known. The US and others have so far chosen to disregard the rupee-part of the bilateral trade because it does not defeat the overarching purpose of depriving Iran of the globally traded currencies of the dollar and euro which it needs to fund its nuclear program. The rupee is not a fully convertible currency.”
I have long had an issue with the economics and politics of the global currency order where one currency, namely the US dollar, has enjoyed primacy for decades. I have always regarded currency value as rather arbitrary which has acquired a measure sanctity because of how long that system has been around. The world needs to seriously consider regional currency arrangements which do not necessarily feel beholden to the US dollar. The idea for regional monetary arrangements has been circulated for a long time. In fact, before the world became what it is today, currency was extremely regional.
The song I refer to shows of a spy masquerading as a roadside beggar begging for the dollar if not the dinar and then says something humorously ingenious when Ludhianvi writes, “If not the whole shirt, the collar would do.” I think it may be worthwhile to consider having different versions of currency rather than letting a handful of currencies hold sway over our lives.
I recognize the importance of and the need for serious economic science and other specific ways to value currencies but let the whole system not become such that it destroys local initiative and ingenuity altogether.
In the specific Iran-India context in light of likely U.S. sanctions, I wonder New Delhi and Teheran would consider reviving the earlier way around it. The situation is significantly different this time since Europe, China and others will not new sanctions. To that extent, things could be easier.
America has already warned European companies against continuing their ties with Iran and asked them to wind down their business. It is in this context that it is significant that France, Germany, Britain and the European Union have sought exemptions from U.S. sanctions on the grounds of protecting their security interests.
At some point soon, India too will have to weigh its options with Iran. And when it does, only the collar might not do.