RESERVE Bank of India (RBI) and Bank Indonesia (BI) signed a Memorandum of Understanding (NK), Thursday (7/3) in Mumbai, India, in the context of establishing a cooperation framework to encourage the use of each country’s local currency in bilateral transactions between the currencies Rupee and Rupiah.
The signing of the NK was carried out by the Governor of the Reserve Bank of India, Shaktikanta Das and the Governor of Bank Indonesia, Perry Warjiyo.
The NK agreement between Bank Indonesia and the Reserve Bank of India is aimed at encouraging the use of each country’s local currency (Rupee and Rupiah) in bilateral transactions which include current account transactions, permitted capital account transactions, as well as economic transactions. and other finances as agreed by both authorities.
“This cooperation framework allows exporters and importers to transact in local currency, which in turn will encourage the development of the foreign exchange markets of the two countries. Furthermore, the use of local currency will reduce transaction costs and increase the efficiency of transaction settlement times,” said Governor of Bank Indonesia Perry Warjiyo, through a statement received, Thursday (7/3).
This collaboration marks an important achievement in strengthening bilateral financial cooperation between Bank Indonesia and the Reserve Bank of India.
Through wider use of each country’s local currency for bilateral transactions, it is hoped that it will contribute to promoting trade between Indonesia and India, deepening financial integration, and strengthening the historical, cultural and economic ties that have existed between the two countries.
(Z-9)
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