India eyes local currencies in trade with African state
India is exploring the possibility of trade in local currencies with Tanzania, Indian Foreign Ministry official Dammu Ravi has said. He added that the issue was discussed during the recent visit of Tanzanian President Samia Suluhu Hassan to New Delhi.
“We are exploring new areas of cooperation, including in trade in local currencies. This is one of the topics discussed by the two leaders,” Ravi stated at a press conference on Monday.
According to Ravi, the East African country has also sought additional lines of credit from India in defense and other sectors, in addition to the $1.1 billion offered by New Delhi previously.
The joint statement released following the meeting between Indian Prime Minister Narendra Modi and Hassan mentioned that the leaders had expressed the desire to extend bilateral trade using Indian rupees and Tanzanian shillings.
The leaders also said the Reserve Bank of India had cleared the way for trade using local currencies by allowing authorized banks in India to open Special Rupee Vostro Accounts (SRVA) of correspondent banks in Tanzania.
According to the statement, transactions using the mechanism have already begun.
“The two sides agreed to continue with the consultations in order to address any concerns so as to ensure the sustainability of this arrangement,” the statement reads.
In addition, the parties agreed to boost bilateral trade volumes, explore new areas of commercial activity, and assess the possibility of setting up an Investment Park in Tanzania.
The two leaders reviewed the “full range of India-Tanzania relations and have elevated our time-tested relation to a Strategic Partnership,” Modi wrote on X (formerly Twitter), adding that he had an “excellent meeting” with President Hassan.
“Our nations have decided to work together to form a five-year roadmap in the defense sector. This will be beneficial for military training, maritime cooperation, capacity building and the defense industry,” he said.
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