Banks are looking at the possibility of initiating rupee trade with Bangladesh and African countries like Egypt as part of an exercise to make the rupee an international currency, sources said.

The overseas trade in the rupee would safeguard the external sector from the fluctuation in the forex market.

India imported goods worth $3.5 billion from Egypt,$1 billion from Algeria and$2.7 billion from Angola in the last financial year.

As far as Bangladesh is concerned, the import in the last year from the neighbouring country stood at $1.9billion, according to the data provided by the commerce ministry.

Currently, rupee trade arrangements are with Russia, Mauritius, and Sri Lanka through the special rupee vostro account (SRVA).

Indian banks have already opened SRVA with banks of these three nations, operationalising the rupee trade arrangement.

Recently, SBI Mauritius Ltd and People’s Bank of Sri Lanka opened SRVA with SBI. Bank of Ceylon has also opened an account in its Indian subsidiary in Chennai.

Union Bank of India has opened a special rupee account of Rosbank Russia while Chennai-based Indian Bank has opened such accounts with three Sri Lankan banks, including Colombo-based NDB Bank and Seylan Bank.

The finance ministry has asked stakeholders to explore more countries to do the trade in Indian currency.

In all, 18 such special rupee accounts have been opened by 11 banks, including two in Russia and one of Sri Lanka, following approval from the Reserve Bank of India (RBI). The RBI issued detailed guidelines on cross-border trade transactions in the domestic currency in July.