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RBI to permit opening of rupee account outside India: Report
RBI
Photo Courtesy: File image

RBI to permit opening of rupee account outside India: Report

| @indiablooms | 31 May 2024, 02:46 pm

Mumbai/IBNS: The Reserve Bank of India (RBI) on Thursday announced to permit the opening of rupee accounts outside India as part of its strategic action plan to internationalise the domestic currency, reports said.

RBI, in its annual report, said with emphasis on continuous synchronisation of the FEMA operating framework with the evolving macroeconomic environment, rationalisation of various guidelines will be of primary focus.

The central bank stated it has finalised a strategic action plan for 2024-25 and envisaged liberalisation of external commercial borrowing (ECB) framework and 'Go-live' for phase I of software platform for ECBs and trade credits reporting and approval (SPECTRA) project.

As part of the 2024-25 agenda for internationalisation of the domestic currency, the RBI will permit the opening of rupee (INR) accounts outside India by persons residents outside India (PROIs), according to reports.

"INR lending by Indian banks to PROIs and enabling foreign direct investment (FDI) and portfolio investment through special accounts [special nonresident rupee (SNRR) and special rupee vostro account (SRVA)," RBI said in the report.

As per reports, rationalisation of the Liberalised Remittance Scheme (LRS) and review of the IFSC regulations under FEMA are also part of the agenda for the current financial year.

Rationalisation of regulations towards promoting the internationalisation of the INR was undertaken to enable the settlement of bilateral trade in local currencies, the RBI report said.

The liquidity operations would continue to be in sync with the stance of the monetary policy, while the foreign exchange operations would be guided by the objective of ensuring orderly movements in the exchange rate of the rupee, the report added.

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