RBI Draft Directions on Forex Dealings of Authorised Persons

  • Blog|News|FEMA & Banking|
  • 1 minute
  • By Taxmann
  • |
  • Last Updated on 20 February, 2026

Latest from Taxmann

RBI foreign exchange dealings

Press Release no. 2025-2026/2130; Dated: 17.02.2026

The RBI has released draft directions on foreign exchange dealings of Authorised Persons. As per the directions, an authorised dealer (AD) may undertake certain foreign exchange transactions with other ADs and with its overseas branches/entities/IFSC banking units (IBUs)/Offshore Banking Units (OBUs) in Special Economic Zones for the purpose of hedging its exposures, balance sheet management, market making and proprietary positions.

Further, an authorised dealer may undertake non-deliverable derivative contracts (NDDCs) involving INR with other Authorised Dealers and with overseas entities/IBUs/OBUs in Special Economic Zones either directly or on a back-to-back basis through their overseas branches (in case of foreign banks operating in India, through any branch of the parent bank), IBUs, overseas wholly owned subsidiaries and overseas joint ventures, subject to the following conditions:

(a) NDDCs involving INR can be undertaken by an Authorised Dealer Category-I bank, subject to the condition that the Authorised Dealer Category-I bank (or its non-resident parent bank) has an operating IBU;

(b) Such transactions may be undertaken by the wholly owned subsidiary/joint venture of Authorised Dealers incorporated in India, provided the wholly owned subsidiary/joint venture is a banking entity; and

(c) Such transactions may be cash-settled in INR or any foreign currency.

Also, the draft directions cover norms relating to exchange-traded transactions, hedging of gold prices, foreign currency accounts and investments in overseas markets, governance and risk management and market timings.

Click Here To Read The Full Press Release

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied

Leave a Reply

Your email address will not be published. Required fields are marked *

«
»

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on Taxmann.com

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied