ANNOUNCEMENT 15 Nov 2011

In November 2011, the government of India announced a change in its trade finance instruments.

NUMBER OF INTERVENTIONS

1

  • 0 harmful
  • 0 neutral
  • 1 liberalising

SOURCE



Circular DBOD.DIR.No. 52 /04.02.001/2011-12
https://rbi.org.in/scripts/NotificationUser.aspx?Mode=0&Id=6811


Inception date: 31 Mar 2012 | Removal date: 30 Apr 2012
Still in force

Trade finance

On 15 November 2011, the Reserve Bank of India through Circular DBOD.DIR. No. 52 /04.02.001/2011-12 increased the interest ceiling rate on export credit in foreign currency.
 
The ceiling rates vary depending on the origin of the lender. For domestic banks, the ceiling has been raised from LIBOR/EURIBOR plus 200 basis points to LIBOR/EURIBOR plus 350 basis points. This rate is subject to the condition that the banks will not levy any other charges.
 
Further, the interest ceiling rate with overseas banks has been increased from LIBOR/EURIBOR plus 100 basis points to 250 basis points. 
 
This rate is applicable to fresh credit advances after 31 March 2012.
 
The interest rates of export credits in foreign currency were deregulated as of 4 May 2012 (see related measure).

AFFECTED SECTORS

 
N/A

AFFECTED PRODUCTS

 
N/A