Egypt, India consider trading with local currencies, possible entry to India’s stock market

Egypt is looking into dealing with India utilizing local currencies, and potentially raising capital through India’s financial markets as it looks to diversify its financing sources, revealed the Ministry of Finance.

Minister of Finance Mohamed Maait recently met with the Indian Ambassador to Cairo, Ajit Gupte, to discuss opportunities to bolster economic cooperation between the two countries, as well as ways to empower Indian companies to leverage the incentives outlined in the state ownership policy document.

Maait’s recent meeting also explored the potential of utilizing local currencies for trade settlements between Egypt and India.

In April, Ali El-Meselhi, Minister of Supply and Internal Trade, shared that his ministry was considering adopting the country's local currency in its trade transactions with India, China, and Russia, as part of measures to reduce demand on the US Dollar.

Later in June, sources told Reuters that India was evaluating a proposal to switch to a barter trade system with Egypt, which would allow Egypt to make purchases in Indian rupees, for commodities such as fertilizer and gas.

The finance minister stressed Egypt’s commitment to diversifying funding sources and studying possible entry into new financial markets through sustainable financial instruments.

Maait noted the potential returns of Egypt tapping into India’s financial markets, mentioning the country’s success in issuing foreign-currency-denominated bonds in 2023.

The official statement highlighted Egypt-India cooperation in financial inclusion technology and India’s support for Egypt’s comprehensive health insurance project, which aims to make quality healthcare more accessible for all Egyptians.

India is ranked as Egypt’s 9th top exporter with a total trade volume of $3.484 billion, and, as of H1 2023, Indian companies have invested about $170 million in Egypt.