Finance Ministry To Promote Internationalisation Of Rupee

The meeting will be chaired by financial services secretary Sanjay Malhotra, and will witness attendees from the Reserve Bank of India, IBA and other industry bodies

The finance ministry is set to hold a meeting with all stakeholders, including banks, and officials of external affairs, and commerce ministries. The agenda of the meeting is to discuss ways to promote cross-border trade in India’s currency, the Rupee instead of the US dollar. The meeting will be chaired by financial services secretary Sanjay Malhotra, and will witness attendees from the Reserve Bank of India, IBA and other industry bodies.

As per sources, banks would be asked to promote this move by the government by asking exporters to negotiate on rupee based trade. RBI in July issued a detailed circular asking banks to make required arrangements for trade transactions in Indian rupees. This move by the Reserve Bank of India (RBI) is a step towards internationalisation of the Indian Rupee. Presently, a large chunk of mutual trade between India and Russia is getting settled in rupee. This is primarily due to sanctions imposed by the US and Europe following Russia-Ukraine conflict. The RBI had said for settlement of trade transactions, the concerned banks will require Special Rupee Vostro Accounts of correspondent bank/s of the partner trading country.