India and Malaysia on Sunday encouraged industries in both countries to settle bilateral trade transactions in local currencies — a move US President Donald Trump frowns upon and sees as part of an effort by the BRICS bloc to counter the dominance of the dollar.

Malaysia is yet to become a full member of the BRICS, but since April 2023, Kuala Lumpur and New Delhi have begun settling trade in local currencies. The joint statement issued on Sunday after Prime Minister Narendra Modi’s bilateral engagement with his Malaysian counterpart Anwar Ibrahim reflected the intent of the two countries to stay the course.

“Both Prime Ministers appreciated the continued collaboration between Reserve Bank of India and Bank Negara Malaysia to promote usage of local currency settlement in bilateral trade and investments, and encouraged industries on both sides to further facilitate the invoicing and settlement of trade in local currencies, i.e., Indian Rupee and Malaysian Ringgit,” the joint statement said.

Malaysia’s state-owned news agency Bernama quoted Anwar as saying that the use of local currency would be encouraged for trade in energy, digital connectivity and semiconductors.

A host of agreements were signed during the Prime Minister’s visit, which included a meeting with the Indian diaspora in a country that is host to the second-largest population of people of Indian origin in the world.

In his media statement, the Prime Minister said: “Cooperation between us in energy, infrastructure, and manufacturing has grown significantly. Mutual investment in the digital economy, biotechnology, and IT has increased. Tourism and people-to-people ties have also deepened. Inspired by these achievements, today we have decided to bring unprecedented pace and depth to our partnership.”

Stating that the Indo-Pacific is emerging as the engine of global growth, the Prime Minister iterated India’s stated position about the centrality of ASEAN and said New Delhi would further broaden engagement with this grouping. “We are in agreement that the review of the ASEAN-India Trade in Goods Agreement (AITIGA) should be completed at the earliest.”