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 from Rs. 73.305676 (effective April 26, 2012) to Rs. 75.594562 effective May 9, 2012. This revision was made on May 4, 2012, and communicated via this circular dated May 25, 2012.
What it means for you
Banks handling transactions under these protocols must apply the new basket value for all settlements from May 9, 2012. This impacts the conversion rates for rupee-denominated payments linked to the basket, affecting trade finance and remittance operations. Non-compliance could lead to incorrect payment calculations.
What you must do
- Update internal systems and exchange rate feeds with the new basket value of Rs. 75.594562 effective May 9, 2012.
- Notify all concerned constituents, including corporate clients and trade finance desks, about the revision.
- Ensure all deferred payment transactions under the protocols use the correct value from the effective date.
- Maintain records of the circular and implementation for audit and regulatory compliance.
Who it affects
AD Category-I banks, Corporate clients with deferred payment obligations under India-USSR protocols, Trade finance and remittance departments
What is the Special Currency Basket?
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.
When does the new value take effect?
The revised Rupee value of Rs. 75.594562 is effective from May 9, 2012.
What should banks do if they already processed transactions at the old rate after May 9?
Banks should adjust those transactions to reflect the correct value and inform the concerned parties, ensuring compliance with the circular.