How long-term bet on rupee saved Rs 14,000 crore of forex in February, Pg1

Key Highlights:

• In February 2026, Indian traders settled over Rs 14,000 crore of imports in rupees, up from Rs 11,000 crore in January 2026.
• This resulted in approximately $1.5 billion (Rs 14,057 crore) in foreign exchange savings for India in February 2026.

Detailed Insights:

• The RBI has been promoting the settlement of international trade in rupees to reduce dependence on freely convertible currencies like the US dollar and stabilize the exchange rate.
• Settling trade in rupees with countries with whom India has a trade deficit, such as oil exporters, can reduce the current account deficit in convertible currencies.
• Banks from 30 countries have been permitted to open accounts with Indian banks to facilitate trade settlement in rupees, although the actual trade volume is still evolving.
• Imports settled in rupees have risen to 98% of exports settled in the domestic currency in the first 11 months of 2025-26, a significant increase from 57% in 2023-24.

Key Concepts Involved:

• Current Account Deficit: The shortfall when a country's total imports of goods, services, and transfers are greater than its total exports.