The Reserve Bank of India (RBI) has approved foreign banks from 18 countries to open Special Vostro Rupee Accounts (SVRAs) for settling international trade in Indian Rupees. These countries include Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, Russia, Seychelles, Singapore, Sri Lanka, Tanzania, Uganda, and the UK.
                                        

The Internationalisation of the Indian Rupee is a process aimed at increasing the acceptance and credibility of the Indian Rupee across the world through its increased use in invoicing and settlement of cross-border transactions. The benefits of the Internationalisation of Rupee include reducing the need for holding foreign exchange reserves and dependence on foreign currencies, promoting the Indian Rupee as an international currency in the long run, reducing vulnerability to external shocks and currency risks, and increasing the bargaining power of Indian enterprises.
 One of the major challenges of entering into the international market is that it can complicate domestic monetary policy by limiting its effectiveness and independence. This is because the exchange rate of the domestic currency, in this case the Indian Rupee, is subject to heightened volatility due to external factors such as global economic conditions, geopolitical events, and foreign exchange market fluctuations.
 One of the major challenges of entering into the international market is that it can complicate domestic monetary policy by limiting its effectiveness and independence. This is because the exchange rate of the domestic currency, in this case, the Indian Rupee, is subject to heightened volatility due to external factors such as global economic conditions, geopolitical events, and foreign exchange market fluctuations.

In the context of the SVRA system, Vostro accounts are accounts that domestic banks hold for foreign banks in the domestic currency, which in this case is the Indian Rupee. The SVRA system is an additional arrangement to the existing system that uses freely convertible currencies and works as a complementary system.
 

To open an SVRA account, prior approval from the Reserve Bank of India (RBI) is required. This is because the RBI regulates the flow of foreign exchange in and out of the country and oversees the banking system to ensure its stability and integrity. By requiring prior approval, the RBI can monitor and manage the risks associated with cross-border transactions and foreign currency exposure.
  Kolkata-based UCO Bank was the first Indian bank to receive the RBI's approval to open a special Vostro account with Russia's Gazprombank, which was set up by the world's largest gas producer and exporter