Roundup: Indian traders’ bodies hail central bank’s move to settle payments in rupees

By Xinhua News Agency On Jul 13, 2022

Experts said the move is aimed at facilitating trade with sanctions-hit Russia amid the Ukraine conflict, and promoting the Indian currency, especially vis-a-vis the U.S. dollar which, till now, is the sole universal currency to meet international trade requirements. The move of the RBI, India’s central bank, is likely to make trade “easier” with Russia and…

by Pankaj Yadav

NEW DELHI, July 13 (Xinhua) — The recent announcement of the Reserve Bank of India (RBI), which allows the country’s importers and exporters to settle payments in the Indian rupee, has been widely hailed by leading traders’ bodies.

The move of the RBI, India’s central bank, is likely to make trade “easier” with Russia and India’s neighboring countries, and help the long-term goal to “internationalize the Indian currency,” experts said.

This step could be particularly useful for those countries willing to use the Indian rupee as a base currency for trade diversification in their settlement rules, they added.

The Federation of Indian Export Organisations (FIEO) welcomed the new provision to help export/import (Exim) trade with countries having forex shortage.

FIEO president A. Sakthivel said that this move will pave the way for “trading and settlement of Exim transactions in Indian Rupee.”

He also said that this move was a “recognition” of the Indian rupee as an international currency.

Engineering Export Promotion Council India chairman Mahesh Desai said that the RBI’s move would “facilitate” trade with countries under sanction like Iran and Russia.

“The move would also reduce the risk of forex fluctuation, especially looking at the Euro-Rupee parity. We see this as a first step towards 100 percent convertibility of the Indian rupee,” added Desai. Enditem