Will the Indian rupee get an international boost? Reports from cash-strapped Egypt suggest that the country may pay for imports from India in rupees.
Egypt’s supply minister Ali Moselhy told Reuters that the country is looking to pay for imports from India, China and Russia in their local currencies instead of the US dollar.
“Nothing of the sort has been implemented but there are discussions so that we can trade in local currencies of countries like India, Russia or China,” the minister told Reuters.
If Egypt ends up trading with India in rupee, it will join 18 other countries, including Germany, Kenya, Sri Lanka, Singapore, UK, where traders are allowed to import goods by paying in rupee.
The Egyptian minister’s comment comes hours after Bloomberg reported that India was providing Egypt with a credit line worth an unspecified value. But he denied the report.
Moreover, Prime Minister Narendra Modi is set to visit Egypt later this month, as the two countries seek to become strategic partners.
The visit comes at a time when the cash-strapped country is trying to stabilise its economy.
The ongoing Ukraine war has rocked its tourism industry, raised commodity prices, and prompted foreign investors to pull about $20 billion out of its financial markets.
Inflation has risen sharply over the last year after a series of currency devaluations, a prolonged shortage of foreign currency and continuing delays in imports.
Recently, Egypt received a $3 billion package from the International Monetary Fund (IMF). Friendly Gulf nations have also pledged billions in investments to help the North African nation.
(With inputs from agencies)
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