India's central bank rolled out steps including a special window to supply dollars to state-run oil companies to support the rupee.
The special window will open on Monday to meet the entire daily dollar requirements of three state-run oil companies, the Reserve Bank of India said in a statement early Saturday. Under the facility, the RBI will undertake sales of dollars to the oil companies via designated lenders, it said.
The authority also rolled out regulatory steps including stopping the re-booking of any foreign exchange derivative contract involving the rupee which had been canceled. The existing threshold of $100 million equivalent for undertaking transactions to hedge contracted exposures without establishing the existence of the underlying asset has been reduced to $5 million, the RBI said.
The RBI also introduced a foreign exchange risk reserve which will involve banks maintaining with the central bank - in cash - an amount equal to 20% of the rupee equivalent of the notional amount of each transaction which exceeds $2 million, it said.
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The steps come as the rupee fell toward a record low in recent sessions. The central bank has been selling dollars to stem the slide.
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