New Delhi, Aug 21: The Directorate General of Foreign Trade (DGFT) has introduced changes to make it easier for Indian exporters to conduct international trade in Indian rupees, giving businesses greater flexibility in choosing how export transactions are priced and settled.
Under the revised Foreign Trade Policy 2023 provisions, exporters dealing with countries outside the Asian Clearing Union (ACU) can now denominate their export contracts and invoices in Indian rupees or a foreign currency. Payments can also be received through approved banking channels in the agreed currency.
A key change is that eligible rupee payments received through authorised banking channels will qualify for benefits under the Foreign Trade Policy and count towards export obligations. The move provides greater clarity for exporters using the rupee for international transactions.
Exports supported through EXIM Bank financing or Government of India lines of credit can also be invoiced in Indian rupees under the updated provisions.
The rules for ACU member countries will continue to operate under the applicable ACU and Reserve Bank of India requirements. Separate provisions will also remain in place for trade with Nepal and Bhutan.
Transactions involving Iran will continue to be subject to existing restrictions relating to sensitive goods and technologies.
The policy change could benefit Indian exporters by giving them an alternative to traditional foreign-currency settlement. Greater use of the rupee may help reduce the need for currency conversion in eligible transactions and provide businesses with additional options for managing exchange-rate risks.
The move could be particularly useful for trade partners that face difficulties accessing US dollars or conventional international payment channels.
The DGFT’s decision is also aligned with India’s broader efforts to expand the international use of the rupee and encourage more cross-border trade to be conducted using the Indian currency.
The revised framework is expected to provide exporters with greater certainty and flexibility while supporting India’s efforts to strengthen the rupee’s role in international commerce.