Recently, on the occasion of the 90th Foundation Day of the RBI, Prime Minister Narendra Modi had said that after the formation of the new government, the work of the RBI will increase significantly. The Prime Minister had also told the RBI that efforts should be made to make the rupee accessible and acceptable globally. Experts say that after the formation of the new government, the RBI can be vigorously engaged in internationalization of the rupee and reducing dependence on the dollar. In a bid to reduce dependence on the dollar, the RBI has stepped up purchases of gold over the past few months.
According to IMF projections, India’s share in world growth will increase from the current 16 per cent to 18 per cent by 2028 and there will be more expectations from India in global growth and trade. In such a situation, the internationalization of the rupee will reduce the dependence on the dollar of India as well as those countries which do more business than India.
The RBI had set up an internal committee for internationalization of the rupee. As per the recommendation of the committee, India has to be made the hub of rupee transactions as well as the centre of rupee pricing. The currency of the countries with which trade is taking place, the facility of exchange with rupee has to be restored. Indians living abroad will have to be motivated to open rupee-linked bank accounts. And they need to be given a chance. The Indian payment system has to be integrated with the payment systems of other countries. Twenty-four hour availability of rupees at the global level has to be ensured.
India is paying for buying oil from UAE in rupees
Trade in rupees with the United Arab Emirates (UAE) has begun. India is paying for oil from the UAE in rupees and the UAE is buying gems and jewellery from India with the same rupee. However, rupee payments with Russia have been difficult as the country does not import much from India. Along with India, many other countries also want to reduce their dependence on the dollar and India can lead them in this work.
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