RBI and Bank of Mauritius have signed an MoU to facilitate cross-border transactions in INR and MUR. This agreement aims to reduce costs, enhance efficiency, and strengthen economic ties. Key highlights include the signing date, objectives, transaction scope, expected benefits, and strategic importance of the initiative.
The Reserve Bank of India (RBI) and the Bank of Mauritius (BOM) have signed a Memorandum of Understanding (MoU) aimed at fostering bilateral trade and financial collaboration. This agreement allows for the use of the Indian Rupee (INR) and Mauritian Rupee (MUR) in cross-border transactions, which is expected to decrease transaction costs and increase efficiency, thereby enhancing economic ties between India and Mauritius.
The MoU was officially signed by RBI Governor Sanjay Malhotra and BOM Governor Rama Krishna Sithanen on March 12, 2025, in Port Louis, Mauritius. This notable event was attended by Indian Prime Minister Narendra Modi and Mauritian Prime Minister Navinchandra Ramgoolam, which underscores the initiative’s importance.
The key objectives of this MoU include promoting the use of INR and MUR in bilateral trade, facilitating cross-border transactions in local currencies, and reducing reliance on third-party currencies like the US Dollar. This move marks a significant step towards financial independence in trade relations between the two countries.
This agreement encompasses all current account transactions and includes specific permissible capital account transactions agreed upon by both nations, thereby broadening the scope of financial activities.
Expected benefits from this collaboration include reduced costs, quicker settlement times for international trade, and the creation of an INR-MUR market that will enhance liquidity and financial integration. Additionally, it will strengthen historic and cultural ties, enhancing overall trade relations.
Strategically, this initiative reinforces economic cooperation, supports India’s aim to internationalize the Rupee, and aligns with regional financial integration initiatives within the Indian Ocean region.
The signing of the MoU between RBI and BOM signifies an important step towards promoting trade in local currencies, potentially optimizing costs and streamlining transactions. By facilitating the use of INR and MUR, this agreement is set to enhance financial integration and strengthen bilateral ties between India and Mauritius, fostering a cooperative economic environment.
Original Source: currentaffairs.adda247.com
