The article discusses policies on foreign exchange and balance of payments and assesses their effective uses in the Nepalese context. The article raises the question of international monetary reform during the decades following 1944, when a mutual understanding was reached internationally for an orderly arrangement of exchange relationships. The article aims to assess various policy approaches that have been initiated to overcome constraints of international reserve assets found in Nepal and elsewhere. The central focus of the article is the policy problems facing Nepal, arising from the imbalances in Nepal's international account, the Nepalese style of tackling these problems, and some specific but pertinent generalizations with their policy implications. (Rajeev Ranjan Singh 2007-02-16)