India and the United Arab Emirates have started settling bilateral trade in their local currencies with India’s top refiner making payment in rupees for purchase of a million barrels of oil from the Middle Eastern nation, the Indian government said on Monday.
Indian Oil Corp made payment to Abu Dhabi National Oil Company (ADNOC), according to a statement issued by Indian embassy in UAE.
India in July signed an agreement with the UAE allowing it to settle trade in rupees instead of dollars, boosting India’s efforts to cut transaction costs by eliminating dollar conversions.
During a visit by Indian Prime Minister Narendra Modi to the UAE, the two countries also agreed to set up a real-time payment link to facilitate easier cross-border money transfers.
India is keen to push similar local currency arrangements with other countries, as it looks to boost exports amid slowing global trade.
