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Amid geopolitical shifts, India must be secure and self -reliant in international digital payments: SJM

Ashwani Mahajan, national co-convenor, Swadeshi Jagran Manch

Amid heightened geopolitical uncertainties, India’s Aatmanirbhar plank must go beyond manufacturing, the Swadeshi Jagran Manch (SJM) has said.

“Payment system is strategic now, given the current situation and sanctions against Russia. It is of utmost importance to have self reliance in payments system and we need to work towards that,” SJM national co-convenor Ashwani Mahajan told India Narrative.

“We have our own payments system, the UPI (Unified Payment Interface) is a success story but now we need to see how to expand its global acceptance,” Mahajan said, adding that India must attempt to integrate its own payments system with Russia’s indigenous Mir.

Following Russia’s invasion of Ukraine, Moscow has been barred from accessing the SWIFT international payment system.

“Payments system can be weaponised today and we cannot depend on other countries’ mercy..India must look at this issue and even work towards making the rupee more acceptable,” Mahajan said.

Launched in 2016, the UPI, developed by National Payments Corporation of India facilitates real-time inter-bank peer-to-peer and person-to-person transactions.

China too has an indigenously developed payment platform — Cross-Border Interbank Payment System or CIPS. Beijing has already indicated that it may look at aggressively pushing this payment system on the global stage.

“While the thrust should be on Atmanirbhar Bharat, it does not mean that we become a closed economy. We should be able to manufacture in India for the world,” he said.

However, he underlined the need to protect the domestic manufacturers.

On Saturday, Finance Minister Nirmala Sitharaman said that import duties on certain raw materials will be reduced. “We are calibrating customs duty on raw materials and intermediaries for iron and steel to reduce their prices. Import duty on some raw materials of steel will be reduced. Export duty on some steel products will be levied," the minister said in a series of tweets.

This is expected to boost the domestic manufacturers.

Earlier, Tesla’s top boss Elon Musk sought tax breaks for being able to import electric vehicles into India. However, his requests were turned down.

“Such requests should not be entertained..allowing imported EVs into the Indian market would automatically kill our nascent domestic manufacturers,” Mahajan said.

The SJM has also been instrumental in ensuring that India stayed out of the Regional Comprehensive Economic Partnership (RCEP), which was finally inked between 15 countries — China, Japan, South Korea, Australia, New Zealand, Vietnam, Thailand, Singapore, Philippines, Myanmar, Laos, Malaysia, Indonesia, Cambodia and Brunei after years of negotiation. India, which pulled out of the trade deal, said that the move was to protect its own manufacturing sector.    

Also read: India's exports sector registers robust growth despite geopolitical uncertainties

Will China expand its international payment system after SWIFT ban on Russia?