RBI unveils new measures for internationalisation of Indian Rupee | Current Affairs | Vision IAS

Daily News Summary

Get concise and efficient summaries of key articles from prominent newspapers. Our daily news digest ensures quick reading and easy understanding, helping you stay informed about important events and developments without spending hours going through full articles. Perfect for focused and timely updates.

News Summary

Sun Mon Tue Wed Thu Fri Sat

RBI unveils new measures for internationalisation of Indian Rupee

2 min read

RBI Initiatives for Rupee Internationalisation

The Reserve Bank of India (RBI) has announced new measures to promote the use of the Indian Rupee in cross-border transactions. This initiative is part of a broader strategy to internationalise the currency, making it a stable option for global trade, finance, and investment.

Key Measures Announced

  • Loans in Indian Rupees to Non-Residents:
    • Authorised dealer (AD) banks can now extend loans in Indian Rupees to non-residents from Bhutan, Nepal, and Sri Lanka specifically for trade-related transactions.
    • This move aims to enhance trade settlements in INR with these neighboring countries.
    • Commerce Ministry data indicates that 90% of India's exports to South Asia were to these nations in 2024/25, totaling nearly $25 billion.
  • Establishing Transparent Reference Rates:
    • The RBI plans to create transparent reference rates for currencies of India’s major trading partners, such as the Indonesian Rupiah and the UAE Dirham.
    • This step seeks to make pricing more predictable and strengthen the rupee's use in invoicing and settlement of international trade.
    • Currently, the RBI publishes reference rates for the U.S. dollar, euro, Japanese yen, and sterling.
  • Widening Use of Special Rupee Vostro Accounts (SRVAs):
    • Balances in SRVAs, used for trade settlement in local currency, will now be eligible for investment in corporate bonds and commercial papers.
    • Previously, surplus vostro balances were allowed to be invested in central government securities.

Previous Initiatives

The RBI has previously undertaken measures such as bilateral agreements for trade settlement in rupees, promoting Indian payment systems like UPI for cross-border transactions, and reducing rupee volatility to make it more stable and appealing to international investors and businesses.

  • Tags :
  • Reserve Bank of India (RBI)
  • Rupee Internationalisation
Subscribe for Premium Features

Quick Start

Use our Quick Start guide to learn about everything this platform can do for you.
Get Started