![]() A CEPA is a free trade agreement between two countries. This will add to the preferential terms accruing from the Comprehensive Economic Partnership Agreement (CEPA). LCS expected to reduce transaction costs, timeĪdditionally, the LCS system is expected to reduce transaction costs and time, as well as increase reliance on local currencies. The new method also has the potential to transform India-UAE economic relations and global economic engagements. The LCS method reportedly allows traders to choose their payment currency based on mutual agreement.įurthermore, the transactional surplus balance in local currencies can be invested in a variety of assets, such as corporate bonds, government securities, and equities markets. Surplus currencies can be invested in other assets "LCS is likely to have a transformational impact on the bilateral economic relationship and in the larger economic engagements," the Indian mission in the UAE said. It was done under a memorandum of understanding (MoU) signed by Prime Minister Narendra Modi in the UAE last month. The LCS settlement involved the Abu Dhabi National Oil Company (ADNOC) and the Indian Oil Corporation Limited (IOCL). Settlement to help in larger economic engagements This will likely have a transformational impact on the bilateral economic relationship between the two countries. It involved the sale of one million barrels of crude oil using both Indian rupees (INR) and UAE dirhams (AED). In a significant development, India and the United Arab Emirates (UAE) completed the first-ever crude oil transaction under the newly implemented Local Currency Settlement (LCS) system. Aug| 01:14 pm 2 min read India-UAE crude oil settlement in local currencies is significant for trade
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