India and Ghana Forge UPI Link for Instant Cross-Border Transactions

India and Ghana have recently agreed to operationalize the Unified Payment Interface (UPI) with the Ghana Interbank Payment and Settlement Systems (GhIPSS) within the next six months. This strategic move aims to facilitate instant fund transfers for users in both countries.

Background:

• The Unified Payment Interface (UPI) is a real-time payment system developed by the National Payments Corporation of India (NPCI). It allows users to instantly transfer funds between bank accounts using their mobile phones.
• Ghana Interbank Payment and Settlement Systems (GhIPSS) is responsible for managing payment systems in Ghana.

Why Is This Significant?

• The agreement between India and Ghana to operationalize the UPI link within six months has several implications:
  • Enhanced Trade and Investment: By enabling seamless cross-border transactions, businesses and individuals in both countries can engage in trade and investment more efficiently.
  • Currency Independence: Settling payments in local currencies (Indian rupee and Ghanaian cedi) reduces reliance on the US dollar, promoting economic sovereignty.
  • AfCFTA Integration: The discussions also touched upon the African Continental Free Trade Agreement (AfCFTA), emphasizing cooperation and trade opportunities between India and AfCFTA member countries.
• Areas of Cooperation:
  • The identified sectors for bilateral cooperation include:
    • Pharmaceuticals
    • Healthcare
    • Information technology
    • Agriculture
    • Renewable energy
    • Power sector
    • Digital economy
    • Critical minerals
    • Textiles and garments
• Delegations Involved:
  • India’s delegation, led by an Additional Secretary from the Department of Commerce, engaged in comprehensive discussions with Ghanaian officials.
  • The Geological Survey of India, EXIM Bank, and the Indian Pharmacopoeia Commission were part of the Indian delegation.
  • The Confederation of Indian Industry (CII) represented various sectors such as power, fintech, telecommunications, electrical machinery, and pharmaceuticals.

UPI Integration and India and Ghana Trade Relations, Some Key Points:

1. UPI Implementation Timeline:
   • The discussions took place during a Joint Trade Committee (JTC) meeting between Indian and Ghanaian officials in Accra from May 2-3, 2024.
   • Both countries committed to implementing the UPI link within six months, allowing seamless cross-border transactions.
2. Benefits of UPI Linkage:
   • Instant Fund Transfers: Users in India and Ghana will be able to transfer funds instantly using the UPI system.
   • Reduced Dependence on USD: Settling bilateral trade payments in local currencies will reduce reliance on the US dollar and strengthen the Indian rupee.
   • Opportunities for Trade and Investment: The UPI link opens up opportunities for enhanced bilateral trade and mutually beneficial investments in various sectors.
3. Areas of Focus for Bilateral Cooperation:
   • Pharmaceuticals, healthcare, information technology, agriculture, renewable energy, power sector, digital economy, critical minerals, textiles, and garments are among the key areas identified for cooperation.
   • Both sides acknowledged the vast untapped potential for further expansion in trade and investment ties.
4. Delegations Involved:
   • India’s seven-member delegation, led by Additional Secretary from the Department of Commerce, engaged in a comprehensive dialogue with Ghanaian officials.
   • The Geological Survey of India, EXIM Bank, and the Indian Pharmacopoeia Commission were part of the Indian delegation.
   • The Confederation of Indian Industry (CII) also accompanied the official delegation, representing various sectors such as power, fintech, telecommunications, electrical machinery, and pharmaceuticals.
5. Exploring AfCFTA Opportunities:
   • The discussions also touched upon the African Continental Free Trade Agreement (AfCFTA), emphasizing cooperation, standards, investments, and trade events between India and AfCFTA.

Also Read: India’s UPI Revolution: A Trillion-Rupee Success Story