The roadmap and the way forward for rupee trade

Over 35 countries are willing to settle their trade with India in Indian rupee.

- RAM SINGH

The weaponization of financial instruments through economic sanctions and resultant supply-chain disruptions have led to unprecedented levels of socioeconomic problems in the world economy. As a result, the nation state(s) started looking at alternatives to settle global payments including India. The Reserve Bank of India issued directives to encourage India’s traders to settle international payment in rupees. As on today, there are more than 35 countries in the world which are willing to settle their trade with India in Indian rupee.

Policymakers in India foresee rupee-trade, not only as an operational arrangement to overcome the challenges arising-out of sanctions on Russia, but more as a strategic choice of safeguarding the economic interests of India. Accordingly, the Government of India is encouraging its trade partners to open a Special Rupee Vostro Account in India. Along with a functional arrangement with Russia, India is at advanced stage of implementation of this arrangement with countries like UAE, Saudi Arabia, Bangladesh, Sudan, Bahrain, Sri Lanka and many other from the Nordic and MENA region.