Before the Indian dignitary and the President of the United Arab Emirates, Sheikh Mohamed bin Zayed Al Nahyan, the Reserve Bank of India and the Central Bank of the United Arab Emirates signed two memoranda of understanding for the use of the rupee (INR) and the dirham (AED) in the shape of a cross -Border transactions.
The agreements legalize the connection of the payment and messaging systems of both countries’ banks and cover all permissible current and capital account transactions, an official document said.
The agreements will facilitate clearing and payment processes for exporters and importers, enable the development of an INR-AED foreign exchange market, and encourage investment and remittances between the two nations.
It also optimizes transaction costs and settlement time for transactions, including remittances from Indian residents in the United Arab Emirates.
Meanwhile, India and the UAE also forged new educational ties with a memorandum to establish an Indian Institute of Technology (IIT) campus in the Gulf state.
India’s Prime Minister believed the deals were a sign of strong economic cooperation and trust between the two countries, whose bilateral trade has grown by 20 percent since the Comprehensive Economic Partnership Agreement was signed last year, he said.
He noted the local currency trade settlement initiative as a very important aspect of India-UAE cooperation, which will pave the way for further economic cooperation and facilitate international financial interactions.
On the other hand, Modi reiterated his full support to the UAE in preparing and celebrating the COP-28 (United Nations Conference on Climate Change).
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