The Indian rupee, in addition to other currencies, may now be used to settle commerce between India and Malaysia, according to the Ministry of Foreign Affairs (MEA) on Saturday.
The move comes after the Central Bank of India decided in July of last year that transactions made outside of India could be paid for in Indian currency.
“Trade between India and Malaysia can now be settled in Indian Rupee (INR) in addition to the current modes of settlement in other currencies,” the MEA said.
“This follows the decision by the Reserve Bank of India in July 2022 to allow settlement of international trade in Indian Rupee,” it said in a statement.
According to the MEA, the RBI’s programme is aimed at encouraging trade development and boosting the global trading community’s interest in the Indian rupee.
“India International Bank of Malaysia (IIBM), based in Kuala Lumpur, has operationalised this mechanism by opening a special Rupee Vostro account through its corresponding bank in India that is Union Bank of India,” it said.
Vostro accounts are used to make local currency payments.
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