export in INR

[GANESH IYER]

Can export be made in INR... can some one provide the provisions if at all it is possible??

[YAGAY and SUN]

Dear Ganesh

There is no restriction on invoicing of export contracts in Indian Rupees in terms of the Rules, Regulations, Notifications and Directions framed under the Foreign Exchange Management Act 1999. Further, in terms of Para 2.52 of the Foreign Trade Policy (2015-2020) - “All export contracts and invoices shall be denominated either in freely convertible currency or Indian rupees but export proceeds shall be realized in freely convertible currency. However, export proceeds against specific exports may also be realized in rupees, provided it is through a freely convertible Vostro account of a non resident bank situated in any country other than a member country of Asian Clearing Union (ACU) or Nepal or Bhutan.” Indian Rupee is not a freely convertible currency, as yet.

Regards,

YAGAY and SUN

AI Summary

Export invoicing in domestic currency permitted, but export proceeds generally must be realized in a freely convertible currency with limited Vostro exceptions.
Export contracts and invoices may be denominated in a freely convertible currency or in Indian rupees, but export proceeds must ordinarily be realized in a freely convertible currency; an exception permits realization in rupees when routed through a freely convertible Vostro account of a non resident bank situated outside the Asian Clearing Union and outside Nepal and Bhutan. Indian rupee is not a freely convertible currency.