India’s Directorate General of Foreign Trade revised the Foreign Trade Policy on Thursday, allowing exporters to invoice, contract and settle payments in rupees or foreign currencies for transactions with countries outside the Asian Clearing Union, effective immediately.
The policy change removes a long-standing requirement that export proceeds be received in freely convertible currencies in most cases. Rupee-denominated export receipts processed through approved banking channels now qualify for trade-policy benefits and count toward exporters’ obligations.
The updated rules apply to all countries except Nepal and Bhutan, which operate under separate bilateral arrangements. For members of the Asian Clearing Union—Bangladesh, Iran, Maldives, Myanmar, Pakistan and Sri Lanka—contracts must still use currencies determined by the ACU or follow Reserve Bank of India directives.
The move is the latest step by the Reserve Bank of India to expand the international role of the rupee following its 2023 foreign-exchange regulations that broadened rupee usage in cross-border transactions.
