India and Malaysia can now use the Indian rupee to settle trade, in addition to other currencies.
The Reserve Bank of India allowed settlement of international trade in Indian currency in July 2022.
The move aims to facilitate the growth of trade and support the interests of the global trading community in the Indian rupee.
The India International Bank of Malaysia has opened a special Rupee Vostro account through its corresponding bank in India, Union Bank of India.
The use of the Indian rupee for settlement will provide greater flexibility and convenience in trade transactions between India and Malaysia.
The move is expected to boost bilateral trade between the two countries.
The use of the Indian rupee is expected to help reduce transaction costs and currency risks associated with trade settlements.
Malaysia is one of India's key trading partners in the Southeast Asia region.