What changed
The Rupee value of the Special Currency Basket, used for deferred payment protocols between India and the erstwhile USSR, was revised from Rs.75.816175 (effective July 6, 2012) to Rs.78.105433 effective September 17, 2012. This revision was communicated via A.P. (DIR Series) Circular No. 37 dated September 26, 2012.
What it means for you
Banks handling transactions under the India-USSR Deferred Payment Protocols must use the new basket value for all settlements from September 17, 2012. The increase reflects changes in the underlying currency basket composition or exchange rates, impacting the rupee equivalent of outstanding payments. Lenders should ensure accurate conversion and reporting to avoid discrepancies.
What you must do
- Update your systems with the new Special Currency Basket value of Rs.78.105433 effective September 17, 2012.
- Inform all concerned constituents, including corporate clients dealing with deferred payment transactions under the India-USSR protocols.
- Review and adjust any pending settlements or invoices dated on or after September 17, 2012 to reflect the revised rate.
- Ensure compliance with FEMA sections 10(4) and 11(1) as cited in the circular.
Who it affects
AD Category-I banks handling deferred payment transactions under India-USSR protocols, Corporate clients with outstanding obligations under the 1981 and 1985 Deferred Payment Protocols, Treasury and forex operations teams at authorized dealer banks
What is the Special Currency Basket and why does its value change?
The Special Currency Basket is a reference rate used for settlements under the Deferred Payment Protocols between India and the erstwhile USSR. Its value is revised periodically by RBI based on changes in the underlying currency composition or exchange rates.
Which transactions are affected by this revision?
All transactions under the Deferred Payment Protocols dated April 30, 1981 and December 23, 1985 between the Government of India and the erstwhile USSR are affected. The new rate applies from September 17, 2012.
Do we need to adjust past transactions before September 17, 2012?
No, the revision is effective only from September 17, 2012. Transactions prior to that date should use the earlier rate of Rs.75.816175 as per the July 6, 2012 circular.