RBI allows India-Malaysia rupee trade

New Delhi, Apr 4 (KNN) The Reserve Bank of India (RBI) has approved the Indian rupee trade settlement between India and Malaysia to boost exports.

This is in addition to the current modes of settlement in other currencies.

The India International Bank of Malaysia (IIBM) has operationalised a payment mechanism by opening a special Rupee Vostro account through its corresponding bank in India, which is the Union Bank of India, the Indian ministry of external affairs (MEA) has said. 

This RBI initiative aims to foster trade growth and support the interests of the global trading community by facilitating transactions in Indian rupee, MEA said in a statement. 

In 2022 the textile trade between the two countries nearly doubled.

Moving ahead the recent decision can be expected to further boost the bilateral trade.

India's apparel exports to Malaysia reached USD 147.628 million in 2022 from USD 82.538 million in 2021.

Outbound shipments stood at USD 80.282 million in 2020, USD 96.936 million in 2019, USD 82.516 million in 2018, and USD 93.511 million in 2017, according to Fibre2Fashion’s market insight tool TexPro. 

On the other hand India's apparel imports from Malaysia were significantly lower than the exports, but they increased from USD 2.394 million in 2021 to USD 31.477 million in 2022.  (KNN Bureau)