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RBI relaxes forex trade norms

MUMBAI DEC. 21. Backed by strong inflows and foreign exchange reserves, the Reserve Bank of India today further liberalised exchange control regulations by lifting the ceiling on banks to offer foreign currency-rupee swaps and doubled the cap on exporters/importers to book forward contracts up to $100 million without documentary evidence.

The corporates will also have full freedom to freely rebook cancelled contracts relating to exposures falling due within one year without any limit as against the earlier cap of $100 million per financial year, the RBI said in a statement here.

Taking into account the stable market conditions, the RBI said banks would now have the freedom to offer hedging facility to foreign direct investments and will be able to freely invest in overseas money and debt market instruments.The RBI said foreign banks would not be required to spread their requirement of hedging their Tier-1 capital over six months.

All these facilities would be available up to March 31, 2003, subject to review, it added.

— PTI

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• RBI relaxes forex trade norms
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