India partnered with UAE to adopt Cross Border Central Bank Digital Currency Transactions.
India's central bank the Reserve Bank of India (RBI) and the Central Bank of the United Arab Emirates (UAE) have agreed to collaborate on cross-border CBDC transactions of trade.
The aim is to reduce costs and increase the efficiency of cross-border transactions and further the economic tie between India and UAE.
The Reserve Bank of India (RBI) and the Central Bank of the United Arab Emirates (CBUAE) signed a Memorandum of Understanding (MoU) today in Abu Dhabi to enhance cooperation and jointly enable innovation in financial products and services.
Under the MoU, the two central banks will collaborate on different emerging areas of fintech, especially CBDC, and explore interoperability between the CBCs of CBUAE and RBI.
CBUAE and RBI will jointly conduct proof-of-concept (PoC) and pilot of bilateral CBDC bridge to facilitate cross-border CBDC transactions of remittances and trade.
India started its digital rupee pilot in November for the wholesale sector and in December for the retail sector.
According to Ajay Kumar Choudhary an RBI Executive Director express that the country's CBDC will act as an alternative to cryptocurrency.
Furthermore, The Borth country MoU provides for technical partnership and knowledge sharing on matters related to fintech and financial products and services.
"This bilateral engagement of testing cross border use case of CBDC is expected to reduce costs increase efficiency of cross border transaction and further the economic ties. "