The Reserve Bank of India (RBI) has reasons to flaunt the success of its US dollar-rupee swap facility launched in June this year.

The scheme, which was designed to encourage NRIs and Indian companies to bring foreign currency into India, has drawn in $136 billion in inflows as of August 31.

A data released by the RBI reveals NRI deposits contributing $127 billion, or roughly 93%, of the total $136 billion. Provisional figures, subject to reconciliation, show the remaining amount of $5 billion coming from overseas foreign-currency borrowings, and $3.8 billion from external commercial borrowings. While the NRI deposit component has now closed, the other two borrowing-related channels stay open for the next four months till December.

The scheme worked through three channels: NRI deposits held in foreign currency, known as FCNR(B) deposits; overseas foreign-currency borrowings by Indian entities; and external commercial borrowings.

Even as the scheme stands as one of the most successful dollar-mobilisation efforts in India, the government has described the inflows as a way to strengthen India’s ‘external buffers’. – Image credit: Freepik – editor@nrifocus.com