Beans and pulses from Myanmar exported to India will no longer have to go through Singapore dealers to settle letters of credit (L/Cs) now that the two countries have made arrangements for transactions to be made in euros or Singapore dollars.

Export transactions of this kind in US dollars have had to be channelled through Singapore because of US sanctions on Myanmar.

New arrangements

Late last year, Myanmar and India agreed to use euros and Singapore dollars in direct trade transactions as an alternative means to settle credit accounts between the banks of India and Myanmar.

According to the Union of Myanmar Federation of Chambers of Commerce and Industry, the United Bank of India and three state-owned Myanmar banks will manage payments in direct bilateral trade transactions.

The banks in Myanmar are the Myanmar Investment and Commerce Bank, Myanmar Foreign Trade Bank and Myanmar Economic Bank.

Export trade

Myanmar exported 1.34 million tons of various beans and pulses to India in the fiscal year ending 31 March 2008.

The majority of these exports - which earned Myanmar some US$700 million - went to India via Singapore in L/C based transactions.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.