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India Moves to Expand Rupee Trade Settlements

Finance minister says new local‑currency payment mechanisms aim to keep imports flowing for countries facing foreign‑currency shortages.

Overview

  • Finance Minister Nirmala Sitharaman said Friday in Bangkok that India is working to operationalize rupee and other local‑currency settlement arrangements to sustain trade with partners that lack hard currency.
  • The government plans systems that let buyers pay in rupees or their own currencies so exporters receive settlement without requiring the buyer to hold dollars or euros.
  • Sitharaman framed the push as a response to rising geopolitical tensions, debt pressures and balance‑of‑payments stress that leave some countries unable to buy essential goods.
  • She said multilateral development institutions have been slow to respond to such crises, sometimes taking three to four years, which strengthens the case for faster bilateral payment solutions.
  • India is also seeking a rebalanced trade deal with ASEAN and reiterated its 2019 decision to stay out of RCEP to protect domestic industry while deepening bilateral trade ties.