Rupee can be a reserve currency, says Kotak

Mumbai: Banker Uday Kotak called this an opportune moment for the rupee to gain reserve currency status.Kotak said an alternative to the US dollar was needed as the reserve currency has the power to control “all our money in nostro accounts and one morning someone can say that we cannot withdraw and we are stuck”.According to him, no other currency qualifies for reserve status. “Europe can’t (make their currency the reserve) because it is the ‘disunited states of Europe’. I don’t think the UK or Japan have the heft to take that position, though the British pound and the yen are free currencies. China has a major issue of trust with many countries around the world. It is our chance to take a shot at becoming the reserve currency of the world,” said Kotak. On Sunday, Kotak clarified via his Twitter handle that he inadvertently used the words, ‘financial terrorist’ in connection to the US dollar. “What I meant was a reserve currency has disproportionate power, whether it is a nostro account, 500-basis-point rate increase, or emerging countries holding dollar for liquidity,” he tweeted.