Heaptalk, Jakarta — Bank Indonesia announced its partnership with the Reserve Bank of India to use local currency in bilateral transactions as one of its de-dollarization efforts. This collaboration was marked by the signing of an MoU in Mumbai, India, by the Governor of the Reserve Bank of India Shaktikanta Das and the Governor of Bank Indonesia Perry Warjiyo (03/07).
The agreement between Bank Indonesia and the Reserve Bank of India aims to encourage the use of each country’s local currency, Rupiah and Rupee, in bilateral transactions which include current account transactions, permitted capital account transactions, as well as economic transactions and other finances as agreed by both authorities.
Further, this collaboration allows exporters and importers to transact in local currency, which can then encourage the development of the foreign exchange markets of both countries. The use of local currency will reduce transaction costs and increase the efficiency of transaction completion times.
This agreement marks a valuable accomplishment in strengthening bilateral financial cooperation between the two parties. The use of each country’s local currency is expected to contribute to promoting trade between Indonesia and India as well as deepening financial integration. Additionally, this cooperation can also strengthen the historical, cultural, and economic relations that have existed between both countries.
