Finance minister Nirmala Sitharaman says wider local-currency settlements could keep essential trade moving for countries struggling to secure dollars, while India seeks to rebalance existing trade pacts.
India is stepping up its push to settle more cross-border trade in rupees, arguing that the approach could help partner countries that are short of hard currency keep buying essential goods. Finance minister Nirmala Sitharaman said the aim is not to replace existing trade ties, but to make payments easier for countries struggling to obtain dollars or other widely used reserve currencies. Reuters-style reporting on her remarks at an Atlantic Council event in Bangkok said she presented the idea as a practical response to tighter foreign-exchange conditions in several economies. The Economic Times and other outlets carried the same message, quoting her as saying India wants to support rupee and local-currency settlements so trade can continue even when importing countries face currency stress.
Sitharaman linked the plan to a wider backdrop of economic weakness, rising geopolitical tensions and the debt and balance-of-payments strains that have hit many countries in recent years. She said multilateral institutions have often moved too slowly when such pressures build, a point also reflected in Business Standard’s account of her comments and in similar reports from Moneycontrol and the Economic Times. The policy, as she framed it, is meant to keep commerce flowing for countries that need to import basics but cannot always secure enough hard currency to pay for them.
India has already been building mechanisms for rupee and other local-currency settlements, and Sitharaman said the government was working on widening that approach. The idea is that a buyer in a partner country could pay in its own currency, with settlement arranged in a way that reduces dependence on the dollar for selected transactions. Supporters argue that this can lower friction in trade with countries under foreign-exchange pressure, although the system is still limited and depends on bilateral arrangements and banking infrastructure. Business Standard and related reports said she described the method as something India has understood and is now trying to operationalise more fully.
Her comments also underlined New Delhi’s increasingly selective approach to trade pacts. Sitharaman said India is open to deeper commercial ties, but that the country wants agreements that are more balanced and do not leave Indian importers or manufacturers disadvantaged. She said the free-trade deal with the Association of Southeast Asian Nations is being reviewed because, in her view, it has been tilted against India, and she signalled a desire to keep it in place in a “slightly refashioned manner”. She also restated India’s decision to stay out of the Regional Comprehensive Economic Partnership, saying the pact did not offer enough for India and that concerns over cheap imports and domestic protections remained central to that choice.
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