RBI to boost rupee’s internationalisation, liberalise norms for non-residents
Reserve Bank of India will boost ongoing efforts towards the internationalisation of the rupee by bringing regulatory changes for non-residents, while taking steps to bolster the GIFT City’s appeal vis-à-vis other international financial centres.
“Efforts are underway towards internationalisation of the Indian Rupee (INR) through settlement of bilateral trade in local currency,” RBI officials wrote in the central bank’s annual report for 2023-24.
“To promote the internationalisation of INR and support local currency settlement with partner countries, it is necessary to liberalise the regulations relating to INR accounts for non-residents,” they wrote.
Accordingly, the Foreign Exchange Management (Deposit) Regulations concerning rupee accounts for non-residents are being reviewed in consultation with the government.
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The central bank’s agenda for the current financial year to internationalise the rupee includes letting persons resident outside India (PROIs) to open rupee accounts outside the country, rupee lending by Indian banks to PROIs and the enabling of foreign direct investment and foreign portfolio investment through special non-resident rupee and special rupee vostro accounts.
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The central bank officials highlighted significant steps taken towards the rupee’s internationalisation in December 2023 via the issuance of the Foreign Exchange Management (Manner
