Dollar is not needed anymore..!? Approval of 18 countries..?
The bank OF INDIA' target='_blank' title='reserve bank of india-Latest Updates, Photos, Videos are a click away, CLICK NOW">reserve bank of india has approved foreign banks from 18 countries to open Vostro accounts in india, through which indian importers can make payments for foreign imports in indian rupees instead of currencies like dollars and euros. In July 2022, the central government announced a framework for making foreign payments in rupees. Following this, RBI has now allowed banks in 18 countries namely Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, russia, Seychelles, singapore, Sri Lanka, Tanzania, Uganda, and the UK to open Vostro accounts in India.
Union minister of State for Finance Bhagwat Kart explained in parliament on tuesday that the bank OF INDIA' target='_blank' title='reserve bank of india-Latest Updates, Photos, Videos are a click away, CLICK NOW">reserve bank of india has so far given approvals to foreign banks from 18 countries to open Vostro accounts in India. The market, the economy, and the price are also data-faced. In this situation, india introduced a system of payment based on the rupee. Through this structure, not only will global trade be encouraged, but the demand for the rupee will increase globally. This will increase the value of the rupee in the international market. Under the indian rupee-based payment system, all export and import bills can be settled in rupees.
For example, if goods are imported from singapore to india, the bill should be calculated in rupees in the currency of both countries. For this, the importers will make payment in rupees.
To enable this, foreign banks should open Special Rupee Vostro accounts in India. It is for this that the RBI has given around 60 approvals to banks from 18 countries, through which foreign trades no longer need to convert rupees to dollars and do not have to pay exchange charges.
In a notification issued by the Ministry of Finance in February, 20 Russian banks, including Rosbank, Tinkoff bank, Centro Credit bank, and Credit bank of Moscow, have opened Vostro accounts in India. At the same time, crude oil arrivals from russia to india reached an all-time high in February.