Settlement Of Foreign Trade In Rupees Will Start Soon

Settlement of foreign trade in rupees will start soon, RBI told banks and companies – to make all preparations.

The Reserve Bank of India (RBI) and the Finance Ministry on Wednesday asked banks and companies to boost exports in rupee terms. Clear the applications coming for this work as soon as possible.

The RBI directive comes at a time when India is using alternative channels to increase its trade with Russia, where payment remains the biggest problem.

The central bank says that creating a rupee-centric business cycle is a long-term process and may take time. But it will help in the globalization of the Indian Rupee.

Settlement of foreign trade: What happened in the meeting?

In the meeting, banks were asked to open Special Rupee Vostro Accounts in Indian Rupees, in which the work of the banks was found to be a bit slow as per the plan.

At the same time, the Ministry of External Affairs, the Department of Commerce, and trade bodies have been asked to conduct awareness campaigns and involve all their partners with this framework.

This is how the new framework will work.

Under the new framework, a government-appointed official dealer will open the Rupee Vostro account of the bank of the country with which the rupee is traded in India.

Indian importers will then have to deposit money into this account to make payments to that country. At the same time, the exporters will be paid only from the money present in the Vostro account.

These countries want to do business in rupees.

According to media reports, Sri Lanka, Argentina, and Zimbabwe are some of the countries that want to do bilateral trade with India in Indian Rupees.

The Indian rupee will have a big advantage.

Experts say that if India’s bilateral trade becomes rupee-centric, then the Indian rupee will get bigger support in the future.

Reducing our dependence on the dollar will also strengthen our currency and this can also reduce the problem of balance of payment.