Reserve Bank of India and Bank of Mauritius Sign Memorandum of Understanding to Promote Use of Local Currencies for Bilateral Transactions
FinTech BizNews Service
Mumbai, March 18, 2025: The Reserve Bank of India (RBI) and the Bank of Mauritius (BOM) signed a Memorandum of Understanding (MoU) for establishing a framework to promote the use of local currencies, viz., the Indian Rupee (INR) and the Mauritian Rupee (MUR) for cross-border transactions. The MoU was signed by the Governor, Reserve Bank of India, Shri Sanjay Malhotra and the Governor, Bank of Mauritius, Dr. Rama Krishna Sithanen G.C.S.K. The MoU documents were exchanged in Port Louis, Mauritius in the presence of the Honourable Prime Minister of India, Shri Narendra Modi and the Honourable Prime Minister of Mauritius, Dr. Navinchandra Ramgoolam, on Wednesday, March 12, 2025.
2. The MoU aims to promote the use of INR and MUR in bilateral trade. The MoU covers all current account transactions and permissible capital account transactions as agreed upon by both the countries. This framework would enable exporters and importers to invoice and pay in their respective domestic currencies, which in turn, would enable the development of a market in the INR-MUR pair. Use of local currencies would optimise costs and settlement time for transactions.
3. This collaboration marks a key milestone in strengthening bilateral cooperation between RBI and BOM. Use of local currencies in bilateral transactions will eventually contribute to promoting trade between India and Mauritius as well as deepen financial integration and strengthen the historical, cultural, and economic relations between India and Mauritius.
The Prime Minister of Mauritius, Dr. the Honourable Navinchandra Ramgoolam, GCSK, FRCP and the Prime Minister of India His Excellency Shri Narendra Modi had comprehensive and productive discussions on the entire gamut of bilateral relations between Mauritius and India during the latter’s State Visit to Mauritius from 11 to 12 March 2025.
Economic and Trade Cooperation
Acknowledging that the conclusion of the Comprehensive Economic Cooperation and Partnership Agreement (CECPA), India’s first ever trade agreement with a country in African region, marked a major milestone in the economic and trade relations of both countries, the leaders underscored the need for exploiting the full potential of bilateral trade for the shared objective of economic growth and prosperity of Mauritius and India. Highlighting Mauritius’s locational advantage and cultural linkages, inter-alia, with Africa its being part of African Continental Free Trade Area (AfCFTA), The Prime Minister of Mauritius underlined the need for Indian companies and businesses to see Mauritius as a gateway to India’s engagements with Africa and benefit from trade and business opportunities offered by Africa.
Reiterating their firm commitment to diversify the trade and commercial linkages between the two countries, the leaders agreed to:
i. Hold the second session of High Power Joint Trade Committee under CECPA tofurther strengthen trade, economic cooperation and partnership between the two countries;
ii. Facilitate trade settlements in local currencies, viz.Indian Rupee and Mauritian Rupee, which will work towards derisking bilateral trade,pursuant to signing of an MoU on Local currency Settlement by the partner Central Banks;
iii. Ratify the Protocol on Amendment of Double Taxation Avoidance Agreement at the earliest to harmonise with International Standards on treaty abuse, after ongoing discussions are concluded; and
iv. Promote investments in sunrise sectors such as ocean economy, pharmaceuticals, IT and Fintech, among others, to support Mauritius in diversification of its economy for long term and sustainable economic growth.
Digital cooperation
Underscoring India’s achievements in rolling out of several people-centric digitization initiatives and their positive impact on governance and service delivery,the Prime Minister of Mauritius requested India’s support to the Government of Mauritius on its digitisation drive across sectors, to which the Prime Minister of India expressed full support. In line with this objective, the leaders agreed to:
i. Support implementation of e-judiciary system, and digitisation of archives and records at Mahatma Gandhi Institute;
ii. Strengthen cooperation in the field of ICT including cyber security, Digital Public Infrastructure, and capacity building for the same;and
iii. Explore implementation of successful digital tools developed by India, such as PM Gati Shakti digital platform, as per Mauritius’s requirements.
Defence and Maritime Security cooperation
The two leaders noted that defence and maritime security cooperation remains an important pillar of bilateral relations and close cooperation in this domain has achieved a strategic dimension and benefited both countries immensely. They further agreed that Mauritius and India, having a shared commitment to ensure a free, open, safe and secure Indian Ocean Region, are natural partners in the region and reiterated their resolve to work closely in countering maritime challenges and safeguarding the larger strategic interests in the region.
The Prime Minister of Mauritius conveyed his appreciation to India for its unwavering support to Mauritius in protecting its vast Exclusive Economic Zone through provisioning of defence and maritime assets, regular deployment of ships and aircraft, conducting joint maritime surveillance, hydrographic surveys and patrolling, bilateral exercises and information sharing and training support, thereby emerging as a significant security provider for Mauritius.
The Prime Minister of Mauritius further thanked India for its continued assistance towards refit of Coast Guard Ships Victory, Valiant and Barracuda, on grant basis. The Prime Minister of India noted that Mauritius is a special maritime partner for India and is an important partner under India’s Vision SAGAR. Given our shared objectives in the region, The Prime Minister of India reiterated India’s continued support and assistance to Mauritius in augmenting its defence and security needs.
Reiterating their collective desire to counter growing threats and challenges in the region, the leaders resolved to:
i. Continue cooperation on provisioning of defence and maritime assets and equipment, as per needs and priorities of Mauritius;
ii. Enhance maritime cooperation through increased deployment of ships and aircraft for joint maritime surveillance and hydrography surveys;
iii. Deepen cooperation towards securing EEZ of Mauritius, including through enhanced utilisation of newly built runway and jetty at Agalega;
iv. Assist setting up of National Maritime Information Sharing Centre to enhance maritime domain awareness;
v. Cooperate by providing expertise in the fields of Marine Operations and Marine Engineering; Port Safety Environment, Port Emergency and Port security to Mauritius Port Authority; and
vi. Conduct customized training programme and capacity building initiatives to meet growing needs of Mauritius Police Force.
