"Tanzania and India now to trade in own currencies"

" \r\n \r\n \r\n \r\n \r\n \r\n \r\n \r\n \r\n \r\n <iframe id=\"google_ads_iframe_\/1010816\/CZ-article-sqtop-320x100_0\" tabindex=\"0\" title=\"3rd party ad content\" role=\"region\" name=\"google_ads_iframe_\/1010816\/CZ-article-sqtop-320x100_0\" width=\"412\" height=\"128\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" aria-label=\"Advertisement\" data-load-complete=\"true\" data-google-container-id=\"1\" data-mce-fragment=\"1\"> \r\n \r\n \r\n \r\n Tanzania and India now to trade in own currencies \r\n\r\n \r\n \r\n \r\n \r\n \r\n \r\n Tanzania and India have agreed on an arrangement that will no longer make the US dollar indispensable in trade between the countries. \r\n\r\n \r\n \r\n \r\n \r\n <iframe id=\"google_ads_iframe_\/1010816\/CZ-mobile-article-300x250-1_0\" tabindex=\"0\" title=\"3rd party ad content\" role=\"region\" name=\"google_ads_iframe_\/1010816\/CZ-mobile-article-300x250-1_0\" width=\"300\" height=\"250\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" aria-label=\"Advertisement\" data-load-complete=\"true\" data-google-container-id=\"2\" data-mce-fragment=\"1\"> \r\n \r\n \r\n \r\n\r\nThe bilateral trade settlement arrangement allows Tanzania and India to use their own currencies (the Tanzanian shilling and Indian rupee) in transactions.\r\n\r\n \r\n \r\n\r\nIndia is one of Tanzania\u2019s biggest trading partners, with data from the Indian High Commission in Dar es Salaam putting the value of trade between the countries at $4.5 billion (about Sh10.4 trillion) during the year ending March 2022.\r\n\r\n \r\n \r\n\r\nIndian High Commissioner to Tanzania Binaya Pradhan told The Citizen yesterday that between April 2021 and March 2022, India\u2019s exports to Tanzania stood at $2.3 billion (about Sh5.3 trillion) and imports from the East African nation were quoted at $2.2 billion (about Sh5.1 trillion).\r\n\r\n \r\n \r\n\r\nHe said Tanzanian banks and businesses have the opportunity to make full use of the new framework to enable seamless payment in domestic currencies.\r\n\r\n \r\n \r\n\r\nThis, Mr Pradhan added, is expected to not only help conserve foreign exchange, but also boost bilateral trade.\r\n\r\n \r\n \r\n\r\n\u201cThere is a huge potential for our trade to grow. We are expecting our trade volume to cross $6 billion (Sh13.8 trillion) this year,\u201d he said by phone.\r\n\r\n \r\n \r\n\r\nWhile Tanzania exports minerals, especially gold, and agricultural products to India, the south Asian country exports to the former petroleum products, medicines and engineering goods.\r\n\r\n \r\n \r\n \r\n <iframe id=\"google_ads_iframe_\/1010816\/CZ-mobile-article-320x50-1_0\" tabindex=\"0\" title=\"3rd party ad content\" role=\"region\" src=\"https:\/\/755b6be0ef6d1eea8766b14a5b4c6372.safeframe.googlesyndication.com\/safeframe\/1-0-40\/html\/container.html\" name=\"\" width=\"412\" height=\"250\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" sandbox=\"allow-forms allow-popups allow-popups-to-escape-sandbox allow-same-origin allow-scripts allow-top-navigation-by-user-activation\" data-is-safeframe=\"true\" aria-label=\"Advertisement\" data-google-container-id=\"3\" data-load-complete=\"true\" data-mce-fragment=\"1\"> \r\n \r\n \r\n \r\n\r\nTrade and economist Donath Olomi told The Citizen that the use of local currencies in settlement of trade transactions meant that Tanzania would no longer need to use dollars from its foreign currency reserves.\r\n\r\n \r\n \r\n\r\nThis will bolster exchange rate predictability, which is an important factor in international trade, he added.\r\n\r\n \r\n \r\n\r\n\u201cUnlike the use of dollars, of which we don\u2019t have control over, with the use of local currencies there will be predictability because in the process, we can fix the exchange rate,\u201d Mr Olomi said.\r\n\r\n \r\n \r\n\r\n\u201cThe use of local currencies will also simplify business transactions and cut bank charges since there will be no need to convert your currency into dollars.\u201d\r\n\r\n \r\n \r\n\r\nIn a press release posted on its website, the Indian High Commission in Dar es Salaam said the Reserve Bank of India (RBI) had cleared the way for trade using local currencies by allowing authorised banks in India to open Special Rupee Vestro Accounts (SRVA) in Tanzania.\r\n\r\n \r\n \r\n\r\nTo trade under this mechanism, Tanzanian banks will have to open SRVA in India by approaching authorised Indian banks that will, in turn, approach RBI for their approval with details of the arrangement, the statement further stated.\r\n\r\n \r\n \r\n\r\nThe Bank of Baroda, which has branches operating in Tanzania, has received RBI\u2019s approval for opening SRVAs for its foreign branches and subsidiaries situated in various countries, including Tanzania, the statement said,\r\n\r\n \r\n \r\n \r\n <iframe id=\"google_ads_iframe_\/1010816\/CZ-mobile-320x50-1_0\" tabindex=\"0\" title=\"3rd party ad content\" role=\"region\" src=\"https:\/\/755b6be0ef6d1eea8766b14a5b4c6372.safeframe.googlesyndication.com\/safeframe\/1-0-40\/html\/container.html\" name=\"\" width=\"412\" height=\"250\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" sandbox=\"allow-forms allow-popups allow-popups-to-escape-sandbox allow-same-origin allow-scripts allow-top-navigation-by-user-activation\" data-is-safeframe=\"true\" aria-label=\"Advertisement\" data-google-container-id=\"4\" data-load-complete=\"true\" data-mce-fragment=\"1\"> \r\n \r\n \r\n \r\n\r\nIndian importers undertaking imports through this mechanism will make payments in Indian rupees which shall be created into the special Vestro account of the correspondent bank of the partner country against the invoices for the supply of goods\/services from the overseas seller\/ supplier.\r\n\r\n \r\n \r\n\r\nOn the other hand, Indian exporters undertaking exports of goods and services through this mechanism can be paid their export proceeds in rupees from the balances in the designated Special Vestro Account of the corresponding bank of the partner country.\r\n\r\n \r\n \r\n\r\nThis arrangement is now applicable to 18 countries, including Kenya, Uganda, Botswana, Mauritius and Seychelles, Fiji, Germany, Guyana, Israel, Malaysia, Myanmar, New Zealand, Oman, Russia, Seychelles, Singapore, Sri Lanka and the United Kingdom.\r\n\r\n \r\n \r\n\r\nThe Indian High Commission has organised a stakeholders\u2019 consultation meeting that will take place on March 24 where details of the bilateral trade mechanism using local currencies will be revealed.\r\n\r\n \r\n \r\n \r\n \r\n \r\n "

"Tanzania and India now to trade in own currencies"

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