Internationalisation of Indian Ruppee

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Indian Rupee bolsters New Delhi's economic might in 18 countries
Indian Rupee bolsters New Delhi`s economic might in 18 countries

Indian rupee trade Photograph
STORY HIGHLIGHTS
According to records shared by the Indian government in Rajya Sabha, the Indian parliament`s upper house, Special Vostro Rupee Accounts can be opened in 18 countries.

India's drive to internationalise the Rupee is reaping benefits in one and a half dozen countries across the world. Banks from 18 countries have been allowed by India's central bank, Reserve Bank of India, to open Special Vostro Rupee Accounts (SVRAs) for settling payments in Indian rupees, the Indian government told the parliament which is currently in session.
The government's response came to a question from Bharatiya Janata Party’s Sushil Kumar Modi.
The Union Minister of State for Finance Bhagwat Kishanrao Karad said that the SVRAs could be set up by banks of partner countries by approaching Authorised Dealer (AD) banks in India that may get permission from the RBI after the due procedure.
Rupee internationalisation: Which countries can trade in Indian Rupee?
According to records shared by the Indian government in Rajya Sabha, the Indian parliament's upper house, Special Vostro Rupee Accounts can be opened in 18 countries. They are Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, Russia, Seychelles, Singapore, Sri Lanka, Tanzania, Uganda and the United Kingdom.
In India, the process of SVRAs began in July 2022 when the RBI announced that, "it has been decided to put in place an additional arrangement for invoicing, payment, and settlement of exports/imports in INR [Indian rupees]."
Also read | India steps up rupee's internationalisation for Sri Lanka's economic recovery
"Procedures for trade in INR have been delineated by RBI in the Circular (No 10 RBI/2022-2023/90 dated 11.07.2022 on ‘International Trade Settlement in Indian rupees’. RBI has also issued Frequently Asked Questions on its website. RBI has clarified matters related to operationalisation of SRVAs through the said FAQs, which are available to banks, importers and exporters etc.,” Karad stated in the Rajya Sabha.
Russia top proponent of de-dollarisation move
Among the 18 countries mentioned in the government's response to the parliament, Russia has been actively advocating for the use of local currency in a broader effort to achieve "de-dollarisation."
On the other hand, India's interest in promoting trade in local currency primarily stems from its desire to enhance exports.
The commodities crisis was triggered by Western sanctions imposed on Russia following President Vladimir Putin's launch of offensive on Ukraine.
Over the past year, India has been actively engaging with countries like the United Arab Emirates and Australia to conclude trade agreements. Additionally, India has initiated negotiations with other significant trading partners such as the United Kingdom and the European Union to make towards adopting the Indian Rupee for bilateral and global trade.
 

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