The Reserve Bank of India has today issued guidelines (A P DIR Series Circular No 3 dated July 21, 2011) allowing non-resident importers and exporters to hedge their currency risk in respect of exports from and imports to India, invoiced in Indian Rupees, with AD Category I banks in India. The guidelines have been finalised in consultation with the Foreign Exchange Dealers Association of India (FEDAI) and market participants.

It may be recalled that it was announced in the Annual Policy Statement for the year 2011-12 (para 85), that in order to facilitate greater use of INR in trade transactions, to allow non-resident importers and exporters, in respect of exports and imports invoiced in INR, to hedge their currency risk with AD banks in India through their bankers having vostro account in India.

R.R. Sinha
Deputy General Manager

Press Release : 2011-2012/115