The Reserve Bank of India (RBI) on Wednesday announced a slew of measures to boost foreign exchange (forex) inflows amid a slump in the value of rupees. The Reserve Bank has been closely and continuously monitoring the liquidity conditions in the forex market and has stepped in as needed in all its segments to alleviate dollar tightness with the objective of ensuring orderly market functioning, the RBI said in a statement.
In order to further diversify and expand the sources of forex funding so as to mitigate volatility and dampen global spillovers, it has been decided to undertake measures to enhance forex inflows while ensuring overall macroeconomic and financial stability, the central bank said. In a bid to boost forex inflows the RBI has announced an exemption from Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) on incremental Foreign Currency Non-Resident (Bank) and Non-Resident (External) Rupee deposits.