India in talks about allowing Alipay+ link to its instant payment systems

NEW DELHI: India is in talks with China-related Ant International to allow digital payments platform Alipay+ to be linked to India's leading ‌instant payments system for cross-border transactions, two government sources said.
The move would help make payments easier for Indian tourists as they would be able to use India's Unified Payments Interface (UPI) with merchants in countries that have signed up with Alipay+.
The talks between the Indian government and central bank officials and Singapore-based Ant International, which was founded by ​China's fintech giant Ant Group and now operates independently, reflect further warming of ties ‌with China.
Alipay+ connects about 1.8 billion user accounts with over 150 million merchants across more than 100 markets, according to its website. The company has a significant presence in Asia, Europe, the Middle East and Latin America.
India's ‌UPI has become ubiquitous within the country, processing close ‍to 18 billion transactions ‌a month.
The government and the central bank have been keen ‍to extend its use across borders to help Indian travellers and the diaspora pay in Indian rupees, reducing friction and costs involved with cross-border payments.
The government sources declined to be ⁠identified as the discussions have not been made public.
India's finance ministry, the Reserve Bank of India and the National Payments Corporation of India (NPCI) did not immediately respond to requests for comment.
Ant International did not immediately respond to a request for comment.
A final decision to allow Alipay would be taken after security considerations, ⁠the Indian government sources said.
'There are sensitivities involved in terms of geopolitical positioning or ⁠in terms of securing the country's digital infrastructure and data because of Alipay's roots to China', ⁠one of ‍the ‌sources said.
India imposed tight investment rules on Chinese investors after a border standoff in 2020 and they remain in force.
WARMING TIES
Strained ties after the border standoff slowed the exchange of capital, technology and talent.
India tightened scrutiny of investments by China-based firms or those ‌with China-linked ownership, stalling deals including BYD's proposed $1 billion investment in an electric car venture.
In the face of punishing US tariffs, however, New Delhi began cautiously rekindling ties with Beijing last year. Indian Prime Minister Narendra Modi visited China for the first time in seven years and discussed ways to improve ties when he met Chinese President Xi Jinping.
Last October, India resumed ‍direct commercial flights to China after a five-year hiatus, and eased visa rules for Chinese professionals. — Reuters