India-Tanzania working on 5-year roadmap to expand bilateral trade using local currencies

In a significant development, Prime Minister Narendra Modi and Tanzanian President Samia Suluhu Hassan engaged in extensive discussions in the national capital on Monday, reassuring the importance of India and Tanzania as significant partners in trade and investment.

During her state visit to India, the two leaders deliberated on multiple aspects of their bilateral relationship to enhance their historic ties. PM Modi said that India is working with Tanzania on an agreement to increase trade in local currencies.

Had an excellent meeting with President @SuluhuSamia. We reviewed the full range of India-Tanzania relations and have elevated our time-tested relation to a Strategic Partnership. The areas of our discussion included trade, commerce and people-to-people linkages. pic.twitter.com/ovGfUyDTa3

— Narendra Modi (@narendramodi) October 9, 2023

Key topics on the agenda for their delegation-level talks included boosting trade and investment, reinforcing defense and maritime security, fostering development partnerships, expanding higher education collaboration, and enhancing people-to-people connections.

Prime Minister Modi highlighted the role of Tanzania as India’s closest development partner in Africa. Both leaders expressed their keenness to expand bilateral trade, aiming to transact in local currencies.

Notably, the Reserve Bank of India has already paved the way for trade in local currencies of the Indian Rupee and Tanzanian Shilling, by authorizing Indian banks to establish Special Rupee Vostro Accounts (SRVA) for Tanzanian correspondent banks. Transactions using this mechanism have commenced, with both sides expressing a commitment to sustaining this arrangement.

PM Modi affirmed India’s commitment to furthering economic cooperation with Tanzania, emphasizing that the country holds a special place as India’s largest and closest development partner in Africa.

A joint statement released at the conclusion of their meeting underscored their mutual intent to broaden bilateral trade and directed officials to explore new trade opportunities. Furthermore, they agreed to align trade volume data and work toward enhancing trade volumes through measures such as business delegation visits, exhibitions, and interactions with the business communities of both nations.

Tanzanian President Samia Suluhu Hassan visited after the invitation from President Draupadi Murmu.