1 week ago
India’s Foreign Currency Facility Draws $72.85 Billion
India created a special programme to bring more foreign money into its banking system.
By August 21, the programme had attracted $72.85 billion.
Most of that money, $65.397 billion, came from FCNR(B) deposits made through banks.
Other funds came from overseas foreign-currency borrowings and external commercial borrowings.
The FCNR(B) part of the programme closes on August 31.
The other two parts stay open until December 31.
The RBI says the programme was created when the rupee was under pressure.
Even with the large inflows, the rupee has not moved sharply, and the RBI expects inflows to reach at least $80 billion.
Foreign-currency mobilisation under the RBI’s special USD-INR swap facility reached $72.85 billion by August 21.
FCNR(B) deposits contributed $65.397 billion, nearly 90% of total inflows.
Overseas foreign-currency borrowings added $4.86 billion, while external commercial borrowings contributed $2.591 billion.
The FCNR(B) window is scheduled to close on August 31, while ECB and OFCB facilities remain open until December 31.
RBI Governor Sanjay Malhotra expects total foreign-currency inflows from recent measures to reach at least $80 billion.
- Who
- The Reserve Bank of India, authorised dealer banks, overseas Indians and borrowing companies are involved.
- What
- A special USD-INR swap facility has mobilised $72.85 billion in foreign currency, led by FCNR(B) deposits.
- Where
- The funds were mobilised through India’s banking and financial system.
- When
- The data covered inflows through August 21 and was released on August 22; the FCNR(B) window closes August 31.
- Why
- The RBI introduced the facility to improve foreign-exchange availability and attract foreign-currency inflows while the rupee was under pressure.
Key facts
- Total mobilisation
- $72.85 billion as of August 21
- FCNR(B) deposits
- $65.397 billion
- Overseas foreign-currency borrowings
- $4.86 billion
- External commercial borrowings
- $2.591 billion
- FCNR(B) deadline
- August 31
- ECB and OFCB deadline
- December 31
- RBI inflow expectation
- At least $80 billion
Sources
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