RPCD.RF.DIR.BC.No.10/07.38.01/2003-04

July 17, 2003

Interest Rate on Deposits under Non-resident
(External) Rupee Account (NRE Accounts)

In exercise of the powers conferred by Sections 21 and 35A of the Banking Regulation Act, 1949 and in modification of our Directive RPCD.RF.Dir. BC91A/07.38.01/2002-03 dated April 29, 2003 relating to interest rate on deposits accepted under Non-resident (External) Rupee Account Scheme, the Reserve Bank of India, being satisfied that it is necessary and expedient in the public interest so to do, hereby directs that, until further notice, the interest rates on fresh repatriable NRE deposits for one to three years contracted effective July 17, 2003 should not exceed 250 basis points above the LIBOR/SWAP rates for US dollar of corresponding maturity.

2. The LIBOR/SWAP rates as on the last working day of the preceding month would form the base for fixing ceiling rates for the interest rates that would be offered effective from the following month.

3. The above changes in interest rates will also apply to repatriable NRE deposits renewed after their present maturity period.

(A.V. Sardesai)
Executive Director