Another country to trade in Indian rupee? Saudi Arabia says open to discussions on trade in currencies other than dollar

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Saudi Arabia to trade in Indian rupee? kingdom says open to discussions on settlement in currencies other than dollar

Saudi Minister of Finance Mohammed al-Jadaan. AFP.

Davos: Saudi Arabia stated it’s open to discussions about trade in currencies other than the US {dollars}. This comes at a time when the Indian central financial institution has been attempting to make Indian rupee globally acceptable for international trade settlements.

A report by Bloomberg TV quoted Saudi Arabia’s finance minister Mohammed Al-Jadaan saying, “There are no issues with discussing how we settle our trade arrangements, whether it is in the US dollar, whether it is the euro, whether it is the Saudi riyal.”

Mohammed Al-Jadaan made the assertion on the sidelines of the continued World Economic Forum (WEF) 2023 at Davos, Switzerland.

He additionally stated, “I don’t think we are waving away or ruling out any discussion that will help improve the trade around the world.”

India-UAE ties

The assertion of the finance minister of Saudi Arabia holds significance because it comes inside months after the 2 nations, in September, held discussions on the feasibility of institutionalising Rupee-Riyal trade and introduction of UPI and Rupay playing cards in the dominion.

Notably, India and the UAE had already signed a free trade settlement (FTA) in February 2022 to improve bilateral trade and financial ties.

Earlier, trade minister of India, Piyush Goyal pressured upon the necessity to diversify ties with UAE via trade.

Don’t Miss: Russia begins international trade settlements in rupee, extra nations to be a part of

After assembly along with his Saudi counterpart Majid bin Abdullah Al-Kassabi final yr, Goyal stated: “Discussed ways to attract greater investment and further diversify bilateral trade to boost economic ties between India and Saudi Arabia.”

For the unversed, Saudi Arabia is India’s key oil provider and notably third-largest crude exporter of the country.

According to an information by the Indian commerce ministry, in the primary quarter (April-July) of the present fiscal yr 2022-23, India’s imports from the Kingdom surged by 93 per cent to $15.5 billion, whereas exports had been up by about 22 per cent to $3.5 billion.

Indian rupee trade settlement

The Reserve Bank of India, or RBI, India’s central financial institution, in July final yr arrange Indian rupee trade settle mechanism to entice curiosity from nations.

The rupee trade mechanism is a technique of utilizing INR as a substitute of {dollars} and other large currencies for worldwide transactions.

Must Read: Indian rupee going world? After Russia, 35 nations present curiosity in INR trade settlement mechanism

Already, Russia has began trade settlement in Indian rupee. Sri Lanka can also be in talks with India to use the Indian rupee for international trade transactions.

India’s neighbours together with Bangladesh, Nepal and Myanmar which have been grappling with a scarcity of dollar reserves have additionally confirmed their curiosity in rupee trade settlement mechanism.

Also Read: Why trade settlement in Indian rupee is vital for Russia?

Reports say Tajikistan, Cuba, Luxembourg and Sudan have additionally been speaking to India about utilizing the mechanism.

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