Current · Source: Reserve Bank of India · RBI/2010-11/326 · issued 23 Dec 2010 · ~1 min read
Quick answerRBI now allows oil and gas import payments to be settled in any permitted currency outside the ACU mechanism, reversing the earlier mandate to route such transactions through ACU.
The rule, in the simplest words
Oil and gas import payments can now be settled in any permitted currency outside the Asian Clearing Union (ACU) mechanism.
Authorised Dealer Category-I Banks must update internal procedures to process oil/gas import payments outside the ACU mechanism.
Banks must inform corporate clients involved in oil/gas imports about the new settlement flexibility.
How it plays out — a real example
A forex & trade-finance officer in Indore, working at a bank that handles oil and gas import payments, now has the flexibility to settle these transactions in any permitted currency, reducing potential delays and currency conversion costs for their clients.
What changed
Previously, all eligible current account transactions between ACU member countries, including oil/gas imports, had to be routed through the Asian Clearing Union. This circular exempts oil and gas import payments from that requirement, permitting settlement in any permitted currency outside ACU.
What it means for you
Banks handling oil/gas import payments now have flexibility to use non-ACU currencies, potentially reducing settlement delays and currency conversion costs. This could ease liquidity management for importers and AD banks, but requires updating internal systems and client advisories.
What you must do
Update internal procedures to process oil/gas import payments outside the ACU mechanism.
Inform corporate clients involved in oil/gas imports about the new settlement flexibility.
Ensure compliance with FEMA regulations and any forthcoming amendments to the Manner of Receipt and Payment Regulations.
Who it affects
Authorised Dealer Category-I Banks, Oil and gas importers, Corporate clients dealing with ACU member countries
❓ Common questions
Does this circular apply to all imports from ACU member countries?
No, it specifically exempts only payments for import of oil or gas from the ACU mechanism. Other eligible current account transactions remain subject to ACU routing.
What currencies can now be used for oil/gas import payments?
Any permitted currency outside the ACU mechanism can be used, as per the circular. The exact list of permitted currencies is defined under FEMA regulations.
📜 Read the original circular — full text as issued by RBI
RBI/2010-11/326
A.P. (DIR Series) Circular No. 30
December 23, 2010
To
All Authorised Dealer Category - I Banks
Madam / Sir,
Asian Clearing Union (ACU) Mechanism – Payments for import of Oil or Gas
Attention of Authorised Dealer (AD) banks is invited to Regulation 5 of Notification No.FEMA.14/2000-RB dated May 3, 2000 read with items 7(b) and 7(e) of the Memorandum of Procedure for channelling transactions through the Asian Clearing Union (ACU) in terms of which all eligible current account transactions as defined by the Articles of Agreement of the International Monetary Fund and the export / import transactions between the ACU member countries on deferred payment terms respectively are to be routed through the ACU mechanism.
2. The above provisions have been reviewed and it has now been decided that payment for import of oil or gas should be settled in any permitted currency outside the ACU mechanism.
3. Necessary amendments to the Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2000 are being issued separately.
4. Authorised Dealer banks may bring the contents of this circular to the notice of their constituents concerned.
5.The directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
Yours faithfully,
(Salim Gangadharan)
Chief General Manager-in-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2010-11/326 · issued 23 Dec 2010. The plain-English explanation above is BankPulse’s own independent summary.
Inform corporate clients involved in oil/gas imports about the new settlement flexibility.
📜 Compliance
Update internal procedures to process oil/gas import payments outside the ACU mechanism.
Ensure compliance with FEMA regulations and any forthcoming amendments to the Manner of Receipt and Payment Regulations.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Compliance officer at a bank this circular applies to (Authorised Dealer Category-I Banks, Oil and gas importers, Corporate clients dealing with ACU member countries), your first concrete step on “Oil & Gas Import Payments Exempted from ACU Route” is: “Update internal procedures to process oil/gas import payments outside the ACU mechanism.” (RBI issued this 23 Dec 2010).
Circular: RBI/2010-11/326 -- Oil & Gas Import Payments Exempted from ACU Route
Issued: 23 Dec 2010
Action required: Update internal procedures to process oil/gas import payments outside the ACU mechanism.
Action required: Inform corporate clients involved in oil/gas imports about the new settlement flexibility.
Action required: Ensure compliance with FEMA regulations and any forthcoming amendments to the Manner of Receipt and Payment Regulations.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6163&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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