The Reserve Bank of India (RBI) is in talks with the central banks of 18 other countries to make international payments for imported goods using the digital rupee (CBDC).
India’s central bank representatives plan to make cross-border payments in foreign trade transactions using the central bank’s digital currency (CBDC). The Economic Times reported this.
According to public statements by Shaktikanta Das, the Governor of the RBI, the country’s government aims to use the digital rupee as the main currency to pay for imported goods. For example, the central bank is in talks with representatives of about 18 countries that are willing to use India’s CBDC in cross-border transfers.
Das has repeatedly stressed the importance of developing CBDC infrastructure for foreign trade. Such an approach, he said, would not only speed up international transfers but also preserve the country’s dollar reserves. Das claims that using the digital rupee for foreign trade will increase CBDC users to one million in the domestic market by early July of this year.
Remarkably, just yesterday, the Chinese authorities urged their partners in the Shanghai Cooperation Organization (SCO), of which India is a member, to use CBDC for international settlements more actively. At the same time, the DBS Bank trading platform was launched in China, allowing local businesses to use e-CHY to make payments.
As a reminder, RBI launched a wholesale CBDC pilot in November 2022 and a retail digital rupee pilot in February 2023. In March, RBI entered into an agreement with the UAE Central Bank to explore the possibility of creating a CBDC bridge for trade and remittances.
