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India & Kenya Trade in Local Currencies?
29 Apr
Summary
- India and Kenya exploring trade settlements in their own currencies.
- Discussions included digital payment systems such as UPI.
- An agreement was signed to facilitate the exchange of customs information.
India and Kenya are actively discussing the possibility of settling trade transactions using their respective local currencies. This initiative aims to further promote and facilitate two-way commerce between the nations.
During the India-Kenya Joint Trade Committee meeting held in Nairobi from April 27-28, collaboration on digital public infrastructure was a key topic. Discussions included the potential adoption of UPI-like payment systems to enhance financial inclusion.
An important outcome of the meeting was the signing of a Memorandum of Understanding (MoU) between India's Central Board of Indirect Taxes and Customs (CBIC) and Kenya's Revenue Authority (KRA). This agreement focuses on the exchange of pre-arrival customs information, designed to streamline customs procedures and improve the ease of doing business.
Both nations also acknowledged the potential for greater utilization of Special Rupee Vostro Accounts (SRVAs), which Kenyan banks have opened with Indian banks, to facilitate smoother bilateral transactions. Discussions covered ways to enhance trade diversification and address market access issues across various sectors.
Bilateral trade between India and Kenya demonstrated significant growth, reaching $4.31 billion in the fiscal year 2025-26. This represents a substantial increase of 24.91% compared to the $3.45 billion recorded in the previous fiscal year.
