Tuesday, August 9, 2022
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‘Re for trade’ to boost bilateral options: Govt

NEW DELHI: India is looking at the RBI’s decision to allow invoicing, payment and settlement of export and imports to increase bilateral trade possibilities in Indian currency with its trading partners, including Russia and Iran, as part of a larger strategy to speed up response to the rapidly changing economic and geopolitical situation, government sources said on Tuesday.
A day after the central bank announced the move, a senior government official said that decision has come amid heightened economic worries over monetary tightening by the US Fed, while experts suggested that it is a step towards capital account convertibility.
“It is a timely move that can have a long-term impact on exports and imports. It will help our trading partners get a good value (from the rupee) during a period of uncertainty given that India has macroeconomic stability,” the senior official said, adding that an option existed for “every country” to trade using the rupee.
While ruling out a clampdown on imports due to a widening trade deficit, officials said that the government has moved in quickly to secure India’s economic interests, including increasing the share of oil imported from Russia. From a share of just around 2% in India’s oil import bas- ket last year, the share of Russian crude has now increased to around 10% despite the US and European countries putting pressure on India to block shipments. “The complexion of the basket has changed as we have been able to secure cheaper supplies,” an official said.
Similarly, official said, Indian businesses have learnt to respond to challenges as has been the case in securing sunflower seeds from sources other than Ukraine, which possibly includes Russia too.



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