What changed
The Rupee value of the special currency basket, used for deferred payments under the 1981 and 1985 protocols with the erstwhile USSR, was revised twice. Effective March 10, 2008, the value was set at Rs.58.3849, and from March 24, 2008, it was further revised to Rs.60.5718. This replaces the earlier value of Rs.56.6777 effective from November 29, 2007.
What it means for you
Banks handling transactions under these protocols must apply the updated Rupee values for all settlements from the respective effective dates. The revision reflects changes in the underlying currency basket and impacts the conversion rates for India's debt obligations to the former USSR. AD Category-I banks need to ensure accurate application to avoid discrepancies in payments.
What you must do
- Update your systems with the new Rupee values: Rs.58.3849 from March 10, 2008, and Rs.60.5718 from March 24, 2008.
- Inform all relevant constituents, including corporate clients and treasury teams, about the revised rates.
- Ensure all deferred payment transactions under the protocols use the correct value for the applicable period.
- Review past transactions since March 10, 2008, to confirm correct rate application and adjust if needed.
Who it affects
AD Category-I banks, Corporate clients with USSR deferred payment obligations, Treasury and forex operations teams
What is the special currency basket mentioned in this circular?
It is a basket of currencies used to determine the Rupee value for deferred payments under the 1981 and 1985 protocols between India and the erstwhile USSR. RBI periodically revises its Rupee value.
Do I need to apply both new values retrospectively?
Yes, each value applies from its effective date: Rs.58.3849 from March 10, 2008, and Rs.60.5718 from March 24, 2008. Transactions on or after these dates must use the respective rate.
What if my bank already processed payments using the old rate after March 10?
You should review and adjust those transactions to reflect the correct rate, as per the circular's directions. Inform your constituents and make necessary corrections.