India’s central bank has eased rules for settling international trade in rupees, a move analysts say could bolster the currency’s global profile and reduce the country’s dependence on the US dollar as trade tensions with Washington escalate.
Though New Delhi has distanced itself from global de-dollarisation drives, observer say the shift reflects a pragmatic push to insulate India from dollar volatility and future geopolitical risks.
Earlier this month, the Reserve Bank of India (RBI) said the country’s banks would no longer need prior approval from the central bank before allowing the opening of special Rupee Vostro Accounts, easing the process for cross-border payments in the local currency.
The move came amid the backdrop of Washington imposing import tariffs of 50 per cent on India, even as nations like Brazil called for a Brics trade currency as a dollar alternative.
US President Donald Trump has threatened to impose higher tariffs on Brics – an association of 10 major emerging economies including India – if the bloc tries to weaken the dollar’s global reserve currency status.
India has previously said it neither supports moves for a single Brics currency, nor any efforts aimed at undermining the use of the US dollar.
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