External Affairs Minister S Jaishankar on Saturday said that India and Tanzania have started trade settlements in local currencies and this new initiative will help in promoting commerce between the two countries.
Addressing industry leaders at a function, the minister said India-Tanzania bilateral trade has seen very strong growth, and stood at USD 6.4 billion in 2022-23.
"Now, bear in mind, this is not only a very substantial bilateral trade, but it's also actually a bilateral trade, which is getting increasingly balanced. Many new products are being added to the trade basket...India remains the biggest destination for Tanzanian exports," he said.
There's also an issue which has been brought up from time to time, which is the possibility of trade settlements in our own currencies, Jaishankar said.
"And I want to share with you that the India central bank has cleared such a possibility. So the three Indian banks, which are here, have that ability to do trade settlements in each other's currencies.
"I am told few transactions have already taken place in Indian rupees and Tanzanian shillings, and certainly this will provide an additional mechanism to promote trade between our two countries," he said.
Bank of India, Bank of Baroda, and Canara Bank have operations in Tanzania.
Last year, the Reserve Bank of India and Indian finance ministry asked the top management of banks and representatives of trade bodies to push export and import transactions in rupee. They want banks in India to connect with their foreign counterparts for opening special rupee vostro accounts to facilitate cross-border trade in the Indian currency rather than the popular mode of the US dollar.
About 18 countries have already opened special vostro accounts with Indian banks.
On India-Africa economic ties, the minister said India's trade is USD 98 billion with Africa.
"India's investments are USD 75 billion, and we are expecting both this trade with Africa and investments in Africa to grow, and I certainly, so agree with what you said, which is that now that there is a pan-African larger continental free trade arrangement in the making, as it unfolds, I think it makes it easier to both trade with Africa and invest in Africa," he said.
Jaishankar also stressed on frequent exchanges of business delegations to promote economic cooperation between the two countries.
He noted that in 2022, eight big exhibitions in different sectors took place in Tanzania.
Earlier in the day, Jaishankar inaugurated a bust of Swami Vivekananda at India's cultural centre in Dar es Salaam.