India Seeks SDR Inclusion Amid Global Economic Shifts
The International Monetary Fund (IMF) is set to review its Special Drawing Rights (SDR) basket in mid-2027, and all eyes are on India's chances of getting included. According to the source, the SDR basket currently consists of five currencies: the US dollar, euro, yen, pound sterling, and renminbi. However, with rising global current account imbalances, there is a possibility that the criteria for inclusion may be revised.
India's economy has been growing rapidly, driven by its trade linkages and digital payment networks. The country's Unified Payments Interface (UPI) has made inroads in 11 countries and is expected to go live in over 40 countries soon. This could make the rupee an attractive option for inclusion in the SDR basket.
However, India faces a major roadblock: the 'freely usable' criterion. The country needs to demonstrate that its currency can be widely used in international transactions and traded in global markets. While the rupee's export-to-GDP ratio is impressive at 22%, it still lags behind countries like Japan and China.