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RBI Plans Direct Rupee Rates to Widen Trade Settlement

22 October 20251 min read
ECONOMYRBI Plans DirectRupee Rates toWiden TradeSettlement22 October 2025safalsetu.com

Why in the news

RBI is widening rupee-based trade settlement with key partners to internationalise the rupee and rely less on the US dollar.

Key facts

  • Plan: direct rupee reference rates versus currencies like the UAE dirham and Indonesian rupiah.
  • Benefit: no third-currency route via the dollar, so deals are more efficient and less volatile.
  • Today: daily reference rates exist only for USD, EUR, GBP and JPY.
  • Extension: partners in the Gulf, ASEAN and Mauritius.

Objectives

  • Lower dollar dependence and promote rupee internationalisation.
  • Cut costs, reduce currency risk and speed up settlement.
  • Support the goal of a global economic powerhouse by 2047.

Exam angle

  • RTS (July 2022) allows foreign trade invoicing and payment in rupees.
  • Proposed partners: UAE, Indonesia, Mauritius, other ASEAN and Gulf nations.

Test yourself

1. RBI is working on direct rupee reference rates against which pair of currencies?

The notes cite the UAE dirham and Indonesian rupiah.

2. The Rupee Trade Settlement System, linked to this RBI effort, was introduced in which month and year?

The RTS was introduced in July 2022.

3. India currently maintains daily rupee reference rates for which set of currencies?

Daily reference rates exist for USD, EUR, GBP and JPY.

This topic is part of Daily Current Affairs 20 & 21 October 2025 (15 topics).

All topics of the dayDay quizOctober 2025

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