The MoU seeks to enable the use of INR and MVR for current account transactions, permissible capital account transactions, and other agreed-upon economic and financial exchanges. This initiative will allow exporters and importers to invoice and settle transactions in their domestic currencies, paving the way for the development of an INR-MVR trading pair in the foreign exchange market. The move is expected to reduce costs and settlement times for cross-border trade, Puneet Pancholy, chief general manager of RBI, said in a press release.
This collaboration marks a significant step in enhancing bilateral relations between the two countries. By promoting local currencies in trade, the agreement aims to boost economic ties, strengthen financial integration, and encourage greater trade activity between India and the Maldives.
Both nations view this partnership as a milestone in fostering economic cooperation and envision a deeper financial relationship driven by this local currency framework.
ALCHEMPro News Desk (KD)
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