An Inter-Departmental Group of the Reserve Bank of India has said that the increasing use of Indian rupee in invoicing and settlement of international trade, as well as in capital account transactions, will give the local currency international acceptance. The group was formed to examine the internationalization of rupee and frame a roadmap for the same. Its report and recommendations were placed on the RBI’s website yesterday.
The report states that the internationalization of a currency is also closely interlinked with the nation’s economic progress, especially its prominence in global trade. The group has recommended enabling the rupee as an additional settlement currency in multilateral mechanisms such as the Asian Clearing Union. It has also encouraged the opening of rupee accounts for non-residents both in India and outside the country, and integrating the Indian payment systems with other countries for cross-border transactions. In a press release, RBI has clarified that the report reflects the views of the Inter-Departmental Group and does not reflect the official position of the Reserve Bank. The apex bank will examine the report and then decide on whether and how the recommendations can be implemented.