New Delhi [India], April 1 (ANI): Trade between India and Malaysia can now be settled in Indian Rupee (INR) in addition to the current modes of settlement in other currencies.
This follows the decision by the Reserve Bank of India in July 2022 to allow the settlement of international trade in the Indian Rupee (INR). This initiative by RBI aims to facilitate the growth of global trade and to support the interests of the global trading community in the Indian Rupee (INR).
Notably, India, among others, imports a large amount of palm oil and its derivatives from Malaysia to fulfil its huge domestic edible oil demand.
"India International Bank of Malaysia (IIBM), based in Kuala Lumpur, has operationalised this mechanism by opening a Special Rupee Vostro Account through its Corresponding Bank in India i.e. Union Bank of India," an official statement said by the Ministry of External Affairs said on Saturday.
More details about the trade settlement can be accessed on its website (www.Indiainternationalbank.com.my)Meanwhile, India on Friday unveiled India's new Foreign Trade Policy (FTP) 2023, which seeks to boost the country's exports to USD 2 trillion by the year 2030 and especially focuses on international trade settlement in rupees.
The government has been working towards making the Indian Rupee a global currency and allowing international trade settlement. This mechanism will help in internationalizing the Indian currency in the long run.
A currency can be termed "international" if it is widely accepted worldwide as a medium of exchange.
So far India has been able to do rupee-denominated trade with a few countries and is in close coordination with several others to fructify it. (ANI)