Reserve Bank of India (RBI) and Bank Indonesia (BI) signed a Memorandum of Understanding (MoU) to promote use of local currencies for bilateral transactions.
The MoU was signed for establishing a framework to promote the use of local currencies - the Indian rupee and the Indonesian rupiah - for cross-border transactions, RBI said in a statement. This framework would enable exporters and importers to invoice and pay in their respective domestic currencies, which in turn would enable the development of an INR-IDR foreign exchange market.
“Use of local currencies would optimise costs and settlement time for transactions,” RBI said. The MoU was signed by RBI governor Shaktikanta Das and Bank Indonesia governor Perry Warjiyo.
“The MoU on establishing a framework for cooperation... aims to promote the use of INR and IDR bilaterally,” RBI said.