New Delhi: India’s forex market may be minuscule when compared to developed economies like the US and UK, but government efforts to ease capital movement has led to the country recording the fastest rise in its turnover growth in the segment over the last three years.
India’s share in worldwide foreign exchange market turnover has grown to 0.9% this year, marking a three-fold jump from just 0.3% in 2004.
This is the fastest increase in market share for any other country in the world, according to data compiled by Switzerland-based Bank for International Settlement (BIS).
In comparison, world’s largest forex market the UK has recorded a much lower change, in percentage terms, in growth to 34.1% of share in 2007 from 31.3% three years ago.
The US, second largest market, saw a slowdown in its share growth to 16.6% this year from 19.2% in 2004. Japan, third largest market, also saw its market share easing to 6% from 8.3% three years ago.
“The growth of India among the emerging nations was notable and as the report says, it possibly reflected the efforts of Indian authorities in recent times to ease control on capital movements,” BIS said in its latest Central Bank Survey of Foreign Exchange and Derivatives Market Activity report.
Besides the highest three-fold jump in market share, India also recorded second highest growth in the daily average forex market turnover after China.