An RBI task force on offshore rupee submitted its report on July 30, recommending several steps to incentivise non-residents to access the onshore foreign exchange market.
The RBI has allowed domestic banks to freely offer foreign exchange prices to non-residents at all times, out of their Indian books, either by a domestic sales team or through their overseas branches.
Indian banks will offer forex prices to non-residents at all times, the RBI said on Friday.
"The directions for implementing recommendations will be issued in consultation with the Central government and other regulators. Other recommendations of the committee are under consideration and the decision thereon will be announced in due course," the RBI said in a release.
Such non-delivarable forward trading will take place in the International Financial Services Centres which brings GIFT City in Gujarat as the only operational venue.
The RBI has been taking steps for the cross-border transactions in Indian rupee (INR), especially in respect of external commercial borrowing (ECB), trade credit and exports and imports, thereby reducing the exchange risk for persons resident in India.
It also decided to enhance the scope of non-interest bearing special non-resident rupee (SNRR) account by permitting persons resident outside India to open such accounts to facilitate rupee-denominated ECB, trade credit and trade invoicing. Further, the RBI also plans to ease restriction on the tenure of SNRR account, which is currently 7 years. The RBI will issue guidelines within a month.
Trading in the onshore market has been shrinking at the expense of offshore rupee market, Governor Shaktikanta Das said. London has surpassed India's financial capital Mumbai to become the top centre for trading rupee, according to the Bank for International Settlements last month.
( With inputs from IANS )