India is taking deliberate steps to strengthen the global role of its national currency, the rupee, in international trade. According to government sources cited by local and international media on October 22, New Delhi is seeking to make it easier for its free-trade partners to settle transactions directly in rupees-an effort that reflects the country’s growing ambition to reduce dependence on the US dollar while bolstering the long-term stability and international credibility of its own currency.

The Reserve Bank of India (RBI) has taken the lead in this process, reportedly working on establishing direct rupee exchange rates that bypass the need for intermediary currencies like the US dollar. At present, most currencies worldwide benchmark their exchange rates against the dollar, a practice that solidifies the American currency’s dominant role in global finance. India’s new initiative aims to create a direct valuation mechanism between the rupee and the currencies of its key trade partners-an effort that could gradually loosen that grip.

Bloomberg reported on October 20 that the RBI is currently developing official reference rates for several partner countries, including Mauritius, and is considering similar arrangements for others with which India has strong trade relations. The central bank’s plans also include introducing reference rates for the UAE dirham and the Indonesian rupiah, two currencies closely tied to India’s growing network of free-trade agreements.

India has signed more than a dozen free-trade agreements (FTAs) over the past two decades, with major partners including the United Kingdom, Australia, and the United Arab Emirates. Ongoing negotiations with the United States, Canada, and the European Union signal that India’s trade diplomacy is entering a more assertive phase. In these discussions, the RBI and India’s finance ministry........

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