Rupee Export Earnings Get Parity with Foreign Currencies Under New Trade Policy

The Indian government has made export earnings received in rupees equivalent to those received in freely convertible currencies like the US dollar and euro for availing benefits under the Foreign Trade Policy (FTP).

This move aims to encourage greater use of the rupee in international trade. The Directorate General of Foreign Trade (DGFT) amended the FTP 2023 with immediate effect, aligning its provisions with the Reserve Bank of India’s Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2023.

Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), said this notification removes uncertainty and places eligible rupee export receipts on par with foreign-currency earnings. He added that India would need a stronger support system for wider adoption, including country-specific settlement arrangements, simpler banking procedures, affordable hedging, rupee-based export credit, and export-credit insurance.