Government asks trade bodies, banks to explore trade in rupees

The government has asked trade bodies and banks to explore opportunities for trade in rupee with more countries after having facilitated rupee trade with Russia, Mauritius and Sri Lanka. 

The Indian banks have already opened special Vostro rupee accounts (SVRA) with banks of these three nations, operationalising the rupee trade arrangement. 

SBI Mauritius Ltd and People’s Bank of Sri Lanka have opened an SVRA with State Bank of India (SBI). In addition, Bank of Ceylon has opened an account in its Indian subsidiary in Chennai recently. 

Union Bank of India has opened special rupee account of Ros Bank Russia while Chennai-based Indian Bank has opened such accounts of three Sri Lankan banks, including Colombo-based NDB Bank and Seylan Bank. 

In all 18 such special rupee accounts have been opened by 11 banks, including 2 of Russia and one of Sri Lanka, following approval from the Reserve Bank of India (RBI). The RBI had issued detailed guidelines on cross-border trade transactions in the domestic currency in July. 

In a recent review meeting with stakeholders, sources said, that the finance ministry had asked stakeholders to explore more countries and establish this mechanism as a part of its plans to expand bilateral trades through SVRAs and internationalise indigenous payment modes. 

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