RBI eases overseas borrowing to spur forex inflows
The HinduThe Reserve Bank of India on Wednesday announced a slew of temporary measures aimed at boosting foreign exchange inflows, including a doubling in the overseas borrowing limit for eligible corporates and removal of interest rate ceilings for NRIs’ foreign currency deposits. “It has been decided that with effect from the reporting fortnight beginning July 30, incremental FCNR and NRE deposits with reference base date of July 1, 2022, will be exempt from the maintenance of CRR and SLR,” the RBI said in a circular. It also allowed banks to temporarily raise fresh FCNR and NRE deposits without reference to the extant regulations on interest rates, with effect from July 7 and up to October 31, 2022. To encourage foreign portfolio investment into debt, the RBI said the choice of government bonds available for investment under the fully accessible route would be widened, with all new issuances of G-Secs of 7-year and 14-year tenors, including the current issuances of 7.10% GS 2029 and 7.54% GS 2036, designated as specified securities under the FAR.