India's Central Bank Announces International Trade Settlement in Indian Rupees | Hacker News Reader

India's Central Bank Announces International Trade Settlement in Indian Rupees

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36 pointsmadmax10825 comments

My prediction early on in this war is that America and Europe's sanctions would lead to a collapse of the dollar system. While we're all cheering ourselves on for 'solidarity' with the world, most Americans see 'the world' as just Europe, Canada, Australia, and NZ. They forget that most people on the planet live in other countries, and are not as influenced by the Anglosphere / the West.

People also don't understand that such a thing doesn't happen by people suddenly stopping the use of dollars but rather as the building up of parallel systems slowly over time until one day someone wakes up and asks 'Wait, why do we have dollars anymore?'. But by then, it's too late. Oops.

The US has done virtually everything it can for nearly two generations to preserve the dominance of the USD as the global reserve currency - going as far as launching coups and troops-on-the-ground campaigns.

I think that’s what I find most alarming about this Ukraine thing (discounting nuclear escalation, of course). Weaponizing the reserve currency against Russia was obviously going to have this effect, so why in the world did they score such an obvious own-goal against one of the key pillars of American Empire which has been maintained at nearly all costs since WWII?

Incompetence is the obvious answer but is a bit too pithy for my liking. Maintaining the reserve currency has been an undisputed priority across party lines for my entire life and publicly weaponizing it against Russia for little gain (even in the best case scenario) simply doesn’t make sense to me.

It's the only viable weapon (in the court of public opinion) in the current political landscape.

Essential move for any nation which still has ambition to maintain strategic independence. Whatever you think of Modi, he is certainly an India nationalist, and not prepared to see his country turn into a vassal for any other state.

The weaponisation of dollar system accelerates its decline - predictable and inevitable.

The west’s weaponization of financial and technology systems they control against Russia is accelerating India and other countries in that orbit reevaluating their reliance on those systems. https://www.cfr.org/blog/besides-china-putin-has-another-pot...

Iran, Venezuela before that. Cuba, North Korea. Even China before 1971. It was possible but relative strength has changed.

India is much larger than all those countries, both population-wise and economically.

I think you're right. We can only use this stick for so long before other countries wise up to the fact that something which wasn't politicized becomes a political tool --even if it's rationalized as "necessary".

There are some things which despite all differences, should remain, such as diplomatic representation, among other things.

Someone on this forum recommended Peter Zeihan's The End of the World is Just the Beginning, a book about the unraveling of (American-led) Globalism. This seems to me like the next inch towards that reality.

Significant increase in yuan or euro based settlement would represent an unraveling, this is primarily a utility for India to streamline Russian energy imports.

I agree with the first half, but I'm under the impression that streamlining Russian energy imports means that the USA's ability to exert soft power is weakened, which is a smallllll step toward unraveling of the US-led world order.

IMO, every day that Russia continues to function is a signal that there is blood in the water: that other countries can once again pursue aggression.

Everyday India imports Russian oil it comes closer to helping the end of civilisation as we know it and probably the end of India in sooner time. Look at the insane heatwaves they’ve had this year.

Climate crisis is real.

As opposed to buying US oil, which would not have these same repercussions? What are you on about?

It's about buying any oil and how it's a stupid thing to keep doing and spending time on.

fwiw, there are pretty decent EVs hitting the Indian market.

Car: https://nexonev.tatamotors.com (~22,000$ before tax) Scooter: https://www.atherenergy.com (~1,700$ before tax)

Most private drivers aren't doing hundreds of KMs per day so these lower cost models could help accelerate adoption. There isn't as much hesitation about switching from gasoline since it was never super cheap nor did they have much of a Truck Yeah! culture

Eureka? ... anyone surprised should be admitting limits of their mind as this was very easily predictable (i.e. globalist/deep-state manipulated US has done stupid moves and continues to do so)

I would guess you can't just declare International Trade Settlement in $MY_CURRENCY, you have to have resources and processes in place, hopefully before the declaration date. A curious person would ask, what are these requirements?

Basically the same criteria United has compared to the others countries:

- a large assets backing the money ( the us economy) -A large debt market that can be traded easily ( t-bills ) -A safe economic environment -A protection system for any foreign investors.

No country expect the us offers those conditions. Europe debt is too fragmented, China controls his currency, and Japan is not big enough. .

Russia made the move because the rouble was back by their natural resources.

In India case, I m very surprised by this move and some technicals requirements would be needed.

i am assuming this is going to be used to go back to india-iran trade that was last time decided to be on rupee basis as opposed to dollars in order to escape american sanctions? should be a good start.

iran can sell india oil for rupees, india buys the oil and sells stuff to iran for the same money, negating the need for US$ or euros out of either countries' foreign reserves.

Hopefully this will also strengthen the INR compared to the USD. Good move!

Which will make Indian labor and products more expensive and less attractive.

On the flip side it will also make imports cheaper. Given the fact that India imports more than it exports (monetary value wise), this is a net positive. At least for now.

If I understand this correctly, the exchange rate changes are more related to rate hikes in US and the amount of dollar based debt.https://en.wikipedia.org/wiki/External_debt_of_India#Currenc...

Plus US is one of India's larger trade partners (https://en.wikipedia.org/wiki/List_of_the_largest_trading_pa...) where payments will be USD.

I can't see this having a huge shift on the exchange rate, but hope to see it stabilize soon.

Interestingly, this announcement hasn't moved the USD-INR exchange rate that much, looks fairly stable over the past 24 hours, let's see what happens over the long term.

What about trading inr on forex ?

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