India Eases Rules For Rupee Export Payments, Allows Invoice, Overseas Sales Settlement In INR
India has amended its Foreign Trade Policy to allow rupee payments for exports to non-Asian Clearing Union countries, granting them trade-policy benefits.Summary
The Directorate General of Foreign Trade (DGFT) has amended the Foreign Trade Policy to allow export contracts, invoices, and payments with non-Asian Clearing Union (ACU) countries to be denominated and settled in rupee or foreign currencies. This change aims to facilitate trade, especially with nations facing dollar shortages, by putting rupee payments on par with foreign-currency earnings for trade-policy benefits. The move removes a hurdle to rupee trade and aligns with the Reserve Bank of India's 2023 foreign-exchange rules. However, experts note that "Regulatory permission alone will not create large-scale rupee trade" due to the difficulty foreign buyers face in obtaining rupees and the reluctance of overseas banks to hold a non-fully convertible currency.
(Source：Times Now News)