India ready to compete with dollar, trade with 64 countries will be done in rupees!
https://www.google.com/amp/s/www.news9live.com/business/india-ready-to-compete-with-dollar-trade-with-64-countries-will-be-done-in-rupees-au40-2054033/amp
After the introduction of trade in rupee with Russia, 17 Vostro accounts have been opened in the country and 64 countries, including developed countries like Germany and Israel have expressed interest in doing business through rupee.
India’s imports from Russia up 384% in April-Jan on back of rise in oil trade
◆ RBI proposed a trade settlement system in rupees in July 2022 to attract interest from abroad
◆ Several countries from Africa, and neighboring countries like Bangladesh, Nepal and Myanmar have shown interest in trading in rupees
◆ Special Vostro accounts for countries like Mauritius and Sri Lanka have already been approved by RBI
India’s decision to reduce its dependence on the US dollar in trade with other countries is proving effective. After the introduction of trade in rupees with Russia, 17 Vostro accounts have been opened in the country and 64 countries, including developed countries like Germany and Israel, have expressed interest in doing business through rupees.
The list of 12 Indian banks include UCO Bank, IndusInd Bank Ltd., Union Bank of India Ltd., Canara Bank Ltd., HDFC Bank Ltd., Yes Bank Ltd., State Bank of India, IDBI Bank Ltd., Indian Bank, Punjab National Bank, Bank of Baroda Ltd. and Axis Bank Ltd.
These are the benefits
◆ Use of rupee in cross border transactions will reduce the risk for Indian business.
◆ Protection from currency volatility not only reduces the cost of doing business, but also enables better business growth
◆ This improves the chances of Indian business growing globally.
◆ It also reduces the need to hold foreign exchange reserves. Especially in view of the dollar reserves.
◆ Foreign exchange reserves help in curbing the volatility of the exchange rate.
◆ By reducing the dependence on foreign exchange, India will become less sensitive to external influences..ie, there will be no impact due to increase or decrease in dollar.
RBI proposed a trade settlement system in rupees in July 2022 to attract interest from abroad and reduce dependence on the dollar. For the first time, Germany — a country part of the European Union — has come forward with any Asian nation’s currency i.e. the Indian Rupee.
■ If more than 30 countries agree to do business in Indian Rupee, it may be recognised as an international trading currency.
■ Apart from Russia, Sri Lanka has agreed to do business in the Indian Rupee in the initial phase.
■ Since then, several countries from Africa, and neighboring countries like Bangladesh, Nepal and Myanmar have shown interest in trading in rupees. These countries are facing a shortage of dollars in their foreign exchange reserves.
Tajikistan, Cuba, Luxembourg and Sudan are also in talks to settle trade in rupees. These four countries have taken steps for special Vostro account for trade settlement in rupees. These countries are in touch with banks operating such accounts in India. Special Vostro accounts for countries like Mauritius and Sri Lanka have already been approved by RBI.
By: via Telegram.me/AlliesFin #StockMarket #india
