MUMBAI (Reuters) – The Reserve Bank of India said it is proposing to permit banks with IFSC banking units to offer non-deliverable forex derivative contracts involving the Indian rupee to resident users in the onshore market.
IFSC Banking Unit or an “IBU” is a bank permitted by the Reserve Bank of India to operate from an International Financial Services Centre (IFSC).
IFSC banking units were earlier permitted to transact in rupee NDF forex derivatives contracts with non-residents and with other eligible banks.
This measure will further deepen the FX market in India and provide enhanced flexibility to residents in meeting their hedging requirements, RBI governor Shaktikanta Das said in his policy speech.
(Reporting by Nimesh Vora; Editing by Nivedita Bhattacharjee)
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