The Reserve Bank of India's latest report reveals a significant and growing trend in the internationalisation of the Indian Rupee, with its increased adoption for import and export invoicing and settlement offering mutual benefits to global trading partners.
Key Points
- The Indian Rupee (INR) is increasingly being used for import and export invoicing and settlement, a trend highlighted in the latest RBI annual report.
- The RBI views the internationalisation of the INR as mutually beneficial for trading partners, offering protection against exchange rate risk and reducing the need for costly forex reserves.
- INR-based invoicing and settlement have seen a considerable pick-up since July 2022, with significant compound annual growth rates for both imports and exports.
- Latest data for 2025-26 shows year-on-year growth in INR export invoicing (6.5%), import invoicing (9.5%), export settlement (2.7%), and a substantial import settlement increase (41.2%).
- The use of domestic currency in trade facilitates bilateral exchange rate markets and lowers transaction costs in foreign exchange.
Rupee is being increasingly used for import and export invoicing over the years, showed the data compiled by the Reserve Bank of India, which said the INR internationalisation process has been mutually beneficial to all trading partners.
Over the past few years, several measures have been undertaken by the RBI to enhance the role of INR as an international currency through its increased usage for both current and select capital account transactions.
Benefits of INR Internationalisation
In its annual report released on Friday, the RBI said the ascendence of INR as an invoicing and settlement currency is likely to offer protection against exchange rate risk, reduce the requirement for maintaining costly forex reserves in convertible currencies, and provide other benefits.
In this context, the use of the domestic currency also facilitates the development of bilateral exchange rate markets and reduces transaction costs in foreign exchange transactions.
Growth in INR-Based Trade
There has been a considerable pick-up in INR-based invoicing and settlement since July 2022, RBI said.
During the period August 2022–July 2025, the compound annual growth rate (CAGR) of imports and exports invoiced in INR has been at 20.9 per cent and 12.7 per cent, respectively.
Further, the latest data on trade invoicing and settlement in Indian Rupee (INR) during 2025-26 exhibit a year-on-year growth for export invoicing (6.5 per cent), import invoicing (9.5 per cent), export settlement (2.7 per cent) and import settlement (41.2 per cent), over the corresponding period of the previous year.
Trade Figures in Rupee
In absolute terms, INR invoicing in imports stood at Rs 2.85 lakh crore in 2025-26, up from Rs 2.60 lakh crore in 2024-25 and Rs 1.94 lakh crore in 2023-24.
In case of exports, the invoicing stood at Rs 3.27 lakh crore during the last fiscal, up from Rs 3.07 lakh crore in 2024-25 and Rs 2.87 lakh crore in 2023-24, the data showed.
INR settlement in imports stood at Rs 1.60 lakh crore during 2025-26, compared to Rs 1.13 lakh crore in 2024-25 and Rs 99,680 crore in the year before.
In case of exports, the settlements were valued at Rs 1.72 lakh crore during 2025-26, Rs 1.67 lakh crore in 2024-25 and Rs 1.75 lakh crore in 2023-24.
The INR internationalisation process has been mutually beneficial to all trading partners, and based on the principles of reciprocity, it has given a fillip to trade invoicing in several other emerging market currencies, RBI said.
The Indian rupee traded with a depreciating bias during the last fiscal year amidst trade-related uncertainties, geopolitical tensions, and foreign portfolio investment (FPI) outflows in the equity segment.
