India's FCNR Deposit Scheme Draws Record $127 Billion From NRIs
· Business · LiveMint, NDTV
Non-resident Indians poured $127.2 billion into Indian banks through foreign currency non-resident (FCNR) deposits under an RBI incentive scheme announced on 5 June and closed on 31 August, nearly five times the inflows seen under a similar 2013 scheme. The Reserve Bank of India said its broader dollar swap facility received $136.4 billion by 31 August, including $5.3 billion in overseas foreign currency borrowings and $3.9 billion in external commercial borrowings. The RBI had advanced the FCNR(B) closure date from 30 September, citing the "encouraging response," with swaps against eligible deposits continuing until 11 September. India's foreign exchange reserves stood at $729 billion as of 21 August, recovering from a low of $681 billion on 5 June. HDFC Bank economists noted a surplus rupee liquidity balance of ₹7.76 trillion as of 1 September.
Why it matters
The record inflows have rebuilt the RBI's war chest of foreign exchange reserves and given it greater flexibility to defend the rupee, though banks are now sitting on excess rupee liquidity that will need to be managed.
Read the original report — LiveMint
Join us on Telegram
Breaking news the moment it lands. At 10,000 members we ship the Android app.