According to a recent data by the Reserve Bank of India (RBI), for the period between April 2025–January 2026, NRI deposits had declined nearly 26% to $14.35 billion.

In the wake of this, the RBI is likely to announce incentives for NRI deposits in order to contain the free fall of the domestic currency.

An announcement from RBI to reintroduce the foreign currency non-resident (FCNR (B)) deposit route to ease pressure on the Indian rupee, attracting foreign deposits, is expected.

It is to be noted that the UAE alone accounts for more than 40% of FCNR (B) deposits at Indian banks. The inflows into this have dropped to $0.94 billion from $7.02 billion recorded last year.

This alarming decline is being addressed by the RBI with the introduction of new policies and incentives.

From the start of the war in the Middle East, the Indian rupee began to decline. It even fell to 4% of its value to reach 94.86 a dollar during this period.

The RBI has banned banks from offering rupee non-deliverable forwards (NDFs) to their clients. There is also a restriction by the RBI over bank net overnight foreign exchange positions. – editor@nrifocus.com