The instructions that will encourage rupee settlement in international trade were announced by the commerce ministry on Wednesday. According to trade analysts, in some situations, it will allow exporters to receive the benefits stated by the foreign trade policy even if the export realization is in the domestic currency instead of the dollar.
The Directorate General of Foreign Trade (DGFT) has already announced its decision to allow rupee-based foreign trade invoicing, payments, and settlement. The action was necessary to facilitate rupee commerce and bring the government’s international trade strategy in line with the Reserve Bank of India’s (RBI) announcement from July.
To stop the rupee’s decline against the dollar, the RBI announced a new system to settle international commerce in rupees in July. According to the most recent notification, adjustments have been made to the Foreign Trade Policy (FTP) to reflect changes made to the RBI’s July guidelines for the granting of export advantages, the fulfillment of export obligations, and export realizations in Indian rupees.