The Reserve Bank of India said it has permitted banks operating International Financial Services Centre (IFSC) to offer non-deliverable derivatives contracts utilising rupees to resident non-retail users for hedging.
The step has been taken in order to develop the onshore rupee non-deliverable derivatives contract market and to provide residents with the flexibility to efficiently plan their hedging activities, the RBI announced on its website on Tuesday.
The newly-permitted transactions will be cash-settled in rupees and shall have the flexibility of cash settlement between two relevant banks and between a bank and a person residing outside India in rupees or any foreign currency, the regulator said.
Source By: economictimes
