Industry Odisha Bureau, Jun 6: The significant Monetary Policy Committee (MPC) meeting of the Reserve Bank of India (RBI) held yesterday not only unanimously voted for keeping the repo rate unchanged at 5.25% for the second time in a row, but also decided to announce a host of measures to attract foreign capital.
RBI Governor yesterday informed media that, “The measures along with the tax benefits provided by the Government should help attract foreign capital for government borrowings.”
The RBI has also reportedly decided “to increase the limits for investment by Non-Resident Indians (NRIs) and Overseas Citizenship of India (OCIs) in equity instruments traded on the stock market without SEBI registration.”
In addition, the RBI has also reportedly decided “to extend the same facility to all individual Persons Resident Outside India (PROIs) at par with the NRIs and the OCIs.”
Besides, the RBI has also reportedly decided “to provide facility of concessional forex swap till September 30, 2026 to incentivize External Commercial Borrowings (ECBs) by Public Sector Undertakings (PSUs).”
Apart from this, the RBI has also reportedly decided “to provide similar facility for bearing full hedging cost till September 30, 2026 to Authorized Dealer (AD) banks for raising fresh 3-5-year FCNR (B) deposits.”
Notably, “A Foreign Currency Non-Resident (Bank) [FCNR (B)] deposit is a term deposit maintained in designated foreign currencies by Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs), or Overseas Citizens of India (OCIs) in Indian banks. These deposits are held in currencies such as USD, GBP, EUR, JPY, AUD, SGD, and CAD, and both principal and interest are fully repatriable, protecting funds from exchange rate fluctuations during the deposit tenure.”
