Big move: India, Malaysia back NPCI–PayNet tie-up for cheaper cross-border payments

• India and Malaysia establish Malaysia–India Digital Council for tech cooperation.
• NPCI and PayNet to link payment systems for seamless cross-border transactions
• Both nations to boost ties in semiconductors, energy, food security, and defence

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India and Malaysia on Sunday moved to hardwire their partnership into the kind of systems that change day-to-day commerce, announcing the formalisation of the Malaysia–India Digital Council (MIDC) and backing work to link India’s NPCI payments network with Malaysia’s PayNet for cross-border payments and remittances.

The push, outlined in a joint statement after Prime Minister Narendra Modi’s February 7–8 visit to Malaysia at the invitation of Prime Minister Anwar Ibrahim, is aimed at making bilateral economic ties more frictionless, for tourists, students, small businesses and diaspora-linked remittances, at a time when both countries want more resilient, diversified trade.

The leaders said the MIDC would serve as a platform to deepen cooperation across fintech, e-governance, cybersecurity, artificial intelligence, Digital Public Infrastructure and other emerging technologies. They also welcomed collaboration between NPCI International Limited and PayNet Malaysia to establish bilateral payment linkages, with the statement noting this could enable 'seamless, low-cost' payment and remittance solutions.

In parallel, both governments encouraged greater use of local currency settlement, invoicing and settling trade in Indian rupee and Malaysian ringgit, building on ongoing collaboration between the Reserve Bank of India and Bank Negara Malaysia. The statement positioned connectivity, including air and maritime links, as a key enabler for deeper trade and investment.

Beyond the digital peg, the joint statement highlighted a push to widen economic cooperation into semiconductors and advanced manufacturing. The leaders called the chip sector strategically important and said both sides should deepen value-chain cooperation, including technological innovation, workforce development and supply-chain stability. The statement also referenced ongoing institutional linkages involving industry bodies and academic collaboration.

Energy and climate cooperation also featured prominently. Malaysia’s PETRONAS and Gentari were cited for investments and activity in India’s renewable energy and green hydrogen space, with both sides pointing to scope for larger solar initiatives and collaboration aligned with net-zero ambitions.

On food security, both sides agreed to deepen cooperation in staple commodities and resilient supply chains while respecting domestic policies. Malaysia reiterated its intent to remain a reliable supplier of sustainable palm oil, and both governments signalled interest in collaboration across cultivation and higher value-added palm-based products, alongside “structured engagement” to resolve market access issues.

Security cooperation remained a steady thread. The statement referenced defence exchanges, maritime cooperation and counter-terror collaboration, including work through ASEAN-led frameworks. The leaders condemned terrorism “in all its forms,” called for zero tolerance, and pledged cooperation on terror financing, radicalisation and misuse of emerging technologies. They also noted the conduct of the fifth edition of the Harimau Shakti joint military exercise in December 2025 in Rajasthan.

On the regional stage, the leaders discussed multilateral coordination, including reforms of international institutions and support for a rules-based order, freedom of navigation and overflight consistent with international law. Malaysia welcomed India’s 2026 BRICS chairmanship, while India noted Malaysia’s role as a BRICS partner country and its aspiration to become a member.

Modi invited Anwar to visit India in the near future, the statement said.