The Ministry of External Affairs (MEA) on Friday informed Rajya Sabha said that 22 countries have opened their special rupee vostro accounts in Indian banks to boost global trade. In a statement, MEA said, the Reserve Bank of India (RBI) has implemented an arrangement to facilitate transactions in domestic currencies, promoting global trade growth with a focus on Indian exports.
According to the MEA, the move allows trade settlement with Malaysia in Indian Rupee, operationalised in April 2023 through the opening of a Special Rupee Vostro Account by India International Bank of Malaysia with Union Bank of India.
This mechanism enables direct trading in Indian Rupees, reducing risks related to dependency on hard currencies for businesses, it said. The initiative aims to internationalise the Indian Rupee and foster mutual benefits for both countries by saving each other’s foreign exchange reserves.
“As of now, banks from 22 countries have opened Special Rupee Vostro Accounts in Indian Banks, including Belarus, Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, Russia, Seychelles, Singapore, Sri Lanka, Tanzania, Uganda, Bangladesh, Maldives, Kazakhstan, and the United Kingdom,” MEA said.
The ministry said that the Centre is actively engaging with the Indian trading community, including Small and Medium Enterprises (SMEs), to streamline administrative procedures and implement this mechanism effectively.
(With inputs from Shailendra Wangu)
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