The Reserve Bank of India (RBI) should intervene in both spot and forward markets to arrest Indian rupee's depreciation, suggested a State Bank of India (SBI) Ecowrap report on Tuesday.

As per the report, during the June 2008 to May 2009 period, when rupee depreciated by 13 per cent, the RBI sold dollars worth $43 billion, though the forex reserves at that time stood at $312 billion.

The report cited that even during 1990s, when the total forex reserve was less than $40 billion, the RBI had intervened in the market by selling 8-9 per cent of total reserve to rein in a fall in rupee.

"So, we believe in the present scenario, RBI could go up to its tolerance limit of 10 per cent (a crude proxy of the average ratio over all periods) by selling at least an additional $25 billion in the forex market," the report said.

The apex bank is known to enter the markets via intermediaries to either sell or buy US dollars to keep the rupee in a stable orbit.

In addition, the report said that oil companies may also be asked to purchase all their USD requirements directly from the RBI through a single bank, an arrangement that was used in 2013.

"Further, oil companies may also be asked to borrow USD for import payments directly from foreign branches of Indian Banks. These funds may be borrowed for the longer term instead of the very short-term funds borrowed currently," the report said.

The report comes on a day when latest global trade protectionist measures, along with high crude oil prices, dragged the Indian rupee to a fresh low of 72.98 per US dollar.

At 5 p.m on Tuesday, the rupee closed at 72.98 per greenback from its previous close of 72.51 per dollar. It had opened at 72.60 per US dollar at the Inter-Bank Foreign Exchange Market and remained range bound.

However, the Indian currency's slide commenced from 4.45 p.m onwards as it touched 72.96 breaching its previous intra-day record low of 72.91 made on September 12.

According to analysts, concerns over a rise in the inflation rate, growing protectionism in global trade and an outflow of foreign funds from the country's equity market have had an adverse impact on the Indian currency.

"After comments surfaced that Saudi Arabia is comfortable with higher crude oil prices, Brent prices jumped. At the same time, news came that China has warned of retaliation in trade," said Anindya Banerjee, Deputy Vice President for Currency and Interest Rates with Kotak Securities.

"Both these news, triggered a sharp decline in Chinese currency and rupee. Weak rupee caused a sell-off in Nifty."