The RBI is in talks with other central banks to make international trade and investment more efficient and less costly by using its CBDC, the “digital rupee,” for cross-border payments.
The RBI is reportedly exploring ambitious plans to use its CBDC, the “digital rupee,” to facilitate foreign trade. RBI Governor Shaktikanta Das in multiple public statements discussed the plans, according to a June 27 article in The Economic Times.
Shaktikanta Das, governor of the Reserve Bank of India, emphasized the significance of global trade infrastructure and the need for quicker, more straightforward, and lower-cost international payments in a speech he gave in London in June. He said that the RBI is in ongoing conversations with other central banks that have implemented or are implementing CBDCs.
The number of banks that have opened rupee vostro accounts has increased to 18 since July 2022, according to a report.
India learned the value of having a strong currency after going through the “taper tantrum” crisis. India may be able to lessen its reliance on the US currency and safeguard its foreign exchange reserves with the aid of the digital rupee.
In the worldwide race to introduce a central bank digital currency (CBDC), the RBI is now gaining the lead. The central bank started a pilot project for the retail digital rupee in February 2023 and one for the wholesale digital rupee in November 2022.
A cooperation agreement for exploring a CBDC bridge for trade and remittances was announced by the RBI and the Central Bank of the United Arab Emirates in March. This shows that the RBI is committed to making the digital rupee a success.