Currency: India ups the Ante

(Published in The Express Tribune, January 17, 2011)

India’s very own currency symbol came to light July last year with much fanfare, drawing attention to the currency’s prospects. The symbol aspires to establish its own identity and join the ranks of other first-class currencies such as the pound, euro and dollar.

The symbol, however, is yet to gain mass adoption as India’s own mints and currency notes are still to be updated. The “Rs” indicator still continues to be the preferred notation since it is easier to type out on all keyboards and existing hardware.

In fact, it’s not even clear how one can type out the new symbol even if they wanted to and it seems it will be years before the symbol gets any notable adoption. Nonetheless, the groundwork for establishing its identity has been completed and that’s an important, long-term strategic bet.

Slow adoption rates and recognition aside, the launch of the symbol coincides with the highest levels of trading volumes being observed in the currency’s future contracts, trailing behind the dollar and  the euro.

At a time when the India’s rich-list and middle-class economy continue to bloom, active interest in the currency has been a natural consequence of the increased global participation.

That might explain why the Indian finance ministry sought to establish its own identity for the Indian Rupee and move away from the “Rs” symbol being used for other rupee currencies in Pakistan, Sri Lanka, Nepal, Mauritius, Seychelles, Indonesia and Maldives. By carving out its own identity, a remarkable campaign is now underway.

The symbol has become a matter of national pride and has fostered patriotism and a sense of identity. This ethos was also reflected in the manner in which the design was ‘crowd-sourced’. The competition welcomed design ideas from all nationals and a six-member committee selected the final winner.

Most MBAs already know that consensus-building is an art in itself and is critical in all manners of decision-making. The strategy could not have worked out better as Udaua Kumar, an Indian Institute of Technology graduate and now professor, won the design competition coming out ahead of other candidates such Nondita Correa-Mehrotra, a Massachusetts Institute of Technology (MIT) lecturer and Harvard graduate who initially proposed a new symbol for the rupee to the Reserve Bank of India in August 2005. India has taken other initiatives such as issuing gold coins through the post office as early as October 2008 in order to promote savings and speculation in the gold markets which have since skyrocketed.  The entire exercise is a great lesson in inclusionary decision-making and it would be a welcome change to learn from our neighbour’s economic resolve.