The Reserve Bank of India and the Bank of Mauritius have signed a MoU to use the Indian and Mauritian Rupees for cross-border transactions, streamlining trade and enhancing bilateral relations between the two countries. The agreement aims to optimize transaction costs and settle payments in domestic currencies, fostering a market for the INR-MUR pair.
The Reserve Bank of India (RBI) and the Bank of Mauritius (BOM) have formalized an agreement to enhance cross-border trade by utilizing the Indian Rupee (INR) and the Mauritian Rupee (MUR). This initiative was made official through a Memorandum of Understanding (MoU) signed by RBI Governor Sanjay Malhotra and BOM Governor Rama Krishna Sithanen G C S K in Port Louis, Mauritius, during a bilateral event attended by the Prime Ministers of India and Mauritius on March 12, 2025.
The MoU aims to facilitate the use of INR and MUR for all current account transactions as well as permissible capital account transactions, thereby allowing exporters and importers to bill and transact in their domestic currencies. This strategy is expected to foster the development of a market for the INR-MUR currency pair.
Implementing this framework is anticipated to optimize transaction costs and reduce settlement times, aligning with the goals of enhancing bilateral trade. The RBI emphasized that this collaboration is a significant step towards strengthening cooperation between the two central banks.
Furthermore, the adoption of local currencies in trade is projected to bolster economic relationships and foster financial integration between India and Mauritius, while also deepening the historical and cultural ties that exist between the two nations.
Overall, this agreement is seen as foundational in promoting commerce and economic growth, marking an important milestone in India-Mauritius relations.
The agreement between the Reserve Bank of India and the Bank of Mauritius to utilize local currencies for bilateral trade signifies a strategic advancement in enhancing economic relations. By enabling transactions in Indian Rupees and Mauritian Rupees, the framework aims to streamline trade processes, reduce costs, and strengthen financial ties between the two nations. This initiative is poised to reinforce historical connections while promoting cultural and economic integration.
Original Source: www.business-standard.com
