All export contracts and invoices, other than those involving member countries of the Asian Clearing Union (ACU), shall be denominated either in foreign currency or Indian Rupees. Export proceeds shall be realized either in any foreign currency or in Indian Rupees, the amended para 2.52 of the Foreign Trade Policy (FTP), 2023, said.
Export contracts involving member countries of the ACU, other than Nepal and Bhutan, shall be denominated in a currency determined by the ACU. However, such transactions may also be denominated and settled in accordance with the directions issued by the Reserve Bank of India from time to time, as per the notification issued by Directorate General of Foreign Trade, under Ministry of Commerce & Industry, on 20 August said.
Read notification here: Amendment to Foreign Trade Policy
Export contracts involving Nepal and Bhutan shall be denominated and settled in Indian Rupees, or in accordance with the directions issued by the Reserve Bank of India from time to time. Further, export contracts and invoices under EXIM Bank/Government of India Lines of Credit may also be denominated in Indian Rupees, it said.
The Centre has amended provisions relating to Applicability of FTP Schemes for Export Realisations in Indian Rupees.
As per the amended para 2.53, exports to any country, excluding Nepal and Bhutan, which is realized in Indian rupees shall be eligible for export benefits/incentives and fulfilment of Export Obligations under the FTP, at par with exports realized in any foreign currency.
In the case of exports to Iran, the provisions shall apply subject to compliance with the provisions of para 2.19 of the FTP.
The amendments have been made to align the provisions relating to denomination of export contracts and eligibility for FTP benefits in respect of export realisations in Indian Rupees with the Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2023, the notification said.
