INDIA imports about 85 percent or more of its crude oil to meet its energy needs. With this, the South Asian country wants to lessen transactions costs by trading with oil-rich countries such as the UAE in rupees instead of dollars.
India is the world’s third-largest crude consumer after US and China. In 2023, it overtook China as the country with the largest population in the world.
India’s first-ever payment in rupees for crude oil purchased from the UAE is helping the country promote the internationalization of its local currency.
The South Asian nation plans to trade with more suppliers using rupees in the future.
India has been pursuing a strategy of buying from the cheapest available source without violating any international obligation.
The UAE signed an agreement with the UAE in July to settle trade in rupees instead of dollars.
Besides the UAE, India has also started importing oil from Russia using rupees.
