India launched its international Rupee ambitions on July 13, 2022. And in a matter of less than 9 months our country has become a global currency.
Don’t believe me? Read on.
Our UPI is approved in ~18 countries and with 12 countries at MOU stage. Sooner than later 30 countries will be be exchanging currency with India bypassing the US Dollar.
34 countries have already agreed to trading in the INR. As of yesterday, hold your breathe,
another 64 countries, including Italy & Germany, have evinced interest in Rupee trading. In effect they will be bypassing the US Dollar.
The moment 50 odd countries start trading in the INR, IMF will perforce have to declare the INR a global currency.
Now just think which are our major currency import items – Oil, Gold, Defence and electronic hardware.
India has already made Russia its largest oil source destination and this trade is happening in Rupee.
Now Saudi Arabia is not happy that it is losing market share to the Russians. Also they cannot antagonise the US. So in order to not engage the wrath of America, Saudi is hoping that through the GCC it can get into an FTA with India so that oil payments can be made in the INR.
Recently UAE was in the news as India is buying 200t gold from them. Yea you guessed right – Rupee trading.
Don’t forget that UAE is our third largest trading partner. And when a large part of our EXIM trade happens in the INR, obviously it is going to validate the importance
of the INR. As an added bonus Russia is happy accepting payments for oil in INR as well as in UAE Dirhams.
For defence we have got the offset clause for local manufacturing. This will result in 60-65% defence spending. And we are already taking rapid strides to be Atmanirbhar.
When our four largest import items are going to be based in the local currency, automatically this will boost our foreign currency reserves.
Add to this the fact that FDI in the last 18 months has topped USD 532 bn (or 50% of our FDI since 1947).
will perforce have to trade via local currency. With all these countries invoicing in INR, they will obviously increase trade with India and catapult our exports.
So within a short time, India has become a reserve currency and a store of value along with the US, Euro and Gold.
It is no wonder that the TIME magazine has called the Indian Rupee the future Dollar.
Soon all countries will have to keep the INR in their portfolio of global currencies.
The irony is that China, a USD 18tr economy has not been able to achieve this status. (They claim that the yuan is now accepted in 2 countries, but while keeping their names secret)
So when are you converting all your Dollars to Rupees. De-Dollarisation is a fast emerging trend.
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