A trader counts new 2,000 rupee notes at a wholesale vegetable market in Bangalore, IndiaAP Photo/Aijaz Rahi
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India’s efforts to achieve greater international acceptance of its currency are failing.
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According to the Press Trust of India, no oil transactions were conducted in rupees in the financial year 2022-2023.
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Countries from China to Russia and India have sought to rely less on the dollar for global transactions.
India’s efforts to achieve wider international acceptance of its currency are not going well.
The country’s push to pay for crude oil imports with rupees has hit a wall and its trading partners continue to resist the agreement, the Press Trust of India, a local news agency, reported, citing the Asian country’s oil ministry.
The report said global oil suppliers remain reluctant to receive rupee payments, citing higher transaction costs and exchange rate risks related to limited global acceptance of the Asian currency.
No oil imports were settled in rupees in India’s 2022-2023 fiscal year that ended in March, the country’s oil ministry told a parliamentary committee, PTI reported.
India’s push to internationalize the rupee was seen as part of a broader push among countries from China to Brazil to reduce their dependence on the dollar for international payments and investments. The movement known as dedollarization gained momentum in recent years as the United States used the dollar’s global dominance to impose economic sanctions on countries such as Russia and Iran.
China and Russia are also pushing to increase global use of their own currencies, while the BRICS nations are weighing the possibility of a joint tender. This year, more countries have joined the trend – Indonesia recently set up a task force to expand the use of its currency, the rupiah.
Last year, India’s central bank allowed local importers to open special overseas bank accounts that would allow them to make rupee payments to their trading partners.
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