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Currency coup? India, Iran may use ₹ and rial for trade

New Delhi: In a bid to boost bilateral trade, India and Iran on Saturday agreed to examine the feasibility of using the rupee and the rial as currency for trade, and signed pacts to avoid double taxation. After talks between visiting Iranian President Hassan Rouhani and Prime Minister Narendra Modi, the two nations also agreed to look at the feasibility of a Preferential Trade Agreement as well as reviving the Asian Clearing Union which was used for oil and other trade till US imposed sanctions on the Persian Gulf nation.

Both countries agreed for conclusion of Bilateral Investment Treaty in a fixed time frame, according to the joint statement issued after the bilateral meeting of heads of two nations here. "The two Leaders agreed on the deepening trade and investment cooperation between the two countries. In this context, they recognised the need to put in place an effective banking channel for business transactions. It was noted that permission for the Iranian Pasargadbank to open a branch in India was under advance consideration," it said.

"It was also agreed to set up a Joint Committee of officials to examine feasible options, including Rupee-Rial Arrangement, Asian Clearing Union mechanism to establish functional payment channels."

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