Social Media: July 15, 2023
During an official visit to Abu Dhabi, UAE, on July 15, 2023, Indian Prime Minister Narendra Modi met with Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, the Crown Prince of Abu Dhabi. The meeting marked a significant milestone as India and the United Arab Emirates signed a momentous agreement allowing trade settlements in rupees instead of dollars. This move aims to bolster India’s efforts to reduce transaction costs by eliminating the need for dollar conversions.
In addition to the currency agreement, the two nations also reached another essential understanding to establish a real-time payment link. This new system will facilitate seamless cross-border money transfers, fostering greater economic cooperation between India and the UAE.
The Reserve Bank of India issued a statement on Saturday, emphasizing that these agreements pave the way for smoother cross-border transactions and payments, strengthening the ties between the two countries.
At present, India, as the world’s third-biggest oil shipper and shopper, pays for UAE oil in dollars. However, with the framework announced by India’s central bank last year for settling global trade in rupees, there is now the possibility of making the first rupee payment for UAE oil to Abu Dhabi Public Oil Co (ADNOC).
The bilateral trade between India and the UAE witnessed a significant volume of $84.5 billion during the period from April 2022 to March 2023, reflecting the robust economic relationship between the two nations.
Besides, the Hold Bank of India uncovered that the national banks of India and the UAE consented to connect India’s Brought together Installments Point of interaction (UPI) with UAE’s Moment Installment Stage (IPP). This integration of payment systems is a growing trend in Asia and is expected to lower the cost of cross-border payments.
Prime Minister Modi’s one-day visit to Abu Dhabi further solidified the partnership, as he met with President Sheikh Mohamed bin Zayed Al Nahyan. The meeting reaffirmed the commitment to strengthening economic ties and cooperation between India and the UAE.”