New Delhi, September 29, 2026: Trade between India and the UAE settled in local currencies has reached double-digit levels, Commerce and Industry Minister Piyush Goyal said, highlighting growing adoption of rupee-dirham transactions between businesses in the two countries.

Goyal also said bilateral trade between India and the UAE is very close to pre-war levels and is expected to recover further in the coming months. His comments came after a meeting of the India-UAE High Level Joint Task Force on Investments in Mumbai.

Rupee-Dirham Trade Gains Momentum

The growing use of local currencies marks a shift in the way a portion of India-UAE trade is being settled. Under the local-currency settlement mechanism, Indian exporters can receive payments in Indian rupees, while UAE exporters can receive payments in UAE dirhams.

The accumulated currency holdings can subsequently be converted into US dollars periodically, providing businesses with an additional mechanism for managing cross-border payments.

According to Goyal, businesses are increasingly recognising the potential benefits of local-currency settlements, particularly amid geopolitical disruptions and risks affecting international trade and shipping routes.

Bilateral Trade Moves Towards Recovery

Goyal said India-UAE trade is nearing the levels seen before the disruption caused by the war and expressed confidence that bilateral commerce could return to and move beyond those levels in the coming months.

The comments come as both countries continue to deepen economic cooperation across trade, investment, logistics, energy and other sectors.

India and the UAE have also been working to expand cooperation in digital payments and financial infrastructure. Discussions between the two countries include initiatives involving local-currency settlements, payment and messaging systems and central-bank digital currencies.

Focus on Stronger Economic Partnership

The increased use of rupee-dirham settlements is part of a broader effort to strengthen the India-UAE economic relationship and facilitate smoother cross-border commerce.

The two countries are also targeting significantly higher bilateral trade over the coming years. Their Comprehensive Economic Partnership Agreement has helped expand commercial ties, while both sides continue to explore opportunities across manufacturing, infrastructure, technology, energy and services.

For Indian and UAE businesses, greater use of local currencies could provide another settlement option as trade flows expand.

Investment Ties Also Gain Attention

The latest trade developments come alongside continued efforts to increase investment flows between India and the UAE.

The UAE has indicated plans for additional investment in India across sectors including ports, shipbuilding, space technology, startups and financial markets, according to comments from Goyal reported after the latest bilateral investment discussions.

With trade, investment and payment infrastructure developing in parallel, India and the UAE are seeking to broaden the foundation of their economic partnership.

The rise in local-currency settlements and the movement of bilateral trade towards pre-war levels point to continued efforts by both countries to make their commercial relationship more resilient and diversified.