Recent reports indicate that India and Japan are working on
developing a direct payments mechanism that would allow trade transactions
between the two countries to be carried out using the Indian rupee and the
Japanese yen, reducing or eliminating the need to use the US dollar as an
intermediary currency.
This initiative is part of a trend observed in recent years,
in which various economies are seeking to expand the use of their own
currencies in international trade in order to lower conversion costs, reduce
exposure to dollar fluctuations, and strengthen bilateral financial
cooperation.
If implemented, companies in both countries could settle
trade transactions directly in rupees and yen through a clearing system between
their financial institutions, avoiding the usual use of the dollar in
international transactions. This type of agreement also aims to expedite
payments and offer greater stability to businesses.
One of the aspects that has generated the most interest is
which of the two currencies would act as the intermediary currency within the
new system. In financial markets, a bridge currency is one that facilitates
conversion between two currencies and serves as a reference for settling
international transactions.
Some analysts believe the Japanese yen could assume this
role due to its widespread acceptance in global markets, its high liquidity,
and its status as an international reserve currency. Others argue that the
Indian rupee could gain prominence, especially if the volume of bilateral trade
continues to grow and New Delhi maintains its strategy of gradually
internationalizing its currency.
However, experts caution that replacing the dollar in
bilateral agreements does not necessarily imply an immediate change in the
global monetary system. The US dollar remains the primary currency used in international
trade, central bank reserves, and financial markets, so any diversification
process tends to be gradual and limited to specific sectors or agreements
between countries.