RBI PANEL FOR EASIER FOREIGN PLAY IN CURRENCY MARKET

A Reserve Bankof India (RBI)-appointedtaskforce on offshore rupeemarkets has recommendedthat Indian banks be allowed

to“freelyofferpricestononresidents” andextendlocalmarkettimingstomatchthoseofthe offshorederivativesmarketstotakethestingoutofthespeculativepositionstakenintheoffshorederivativesmarket. NonresidentscanalsobeallowedwideaccesstotheFX-Retail tradingplatformasa“majorincentivetousetheonshore market”, thetaskforce, headedbyUshaThorat, formerRBI deputygovernor, said. Thecommitteesubmitteditsreportto theRBIgovernoronThursday. Todampenthedominanceof theoffshorenon-deliverableforwardmarket, whichcurrently hasmorevolumethanonshoremarkets, thetaskforce suggestedthattheInternationalFinancialServices Centrebeallowedtooffernon-deliverablerupee derivativesinaphasedmanner.

The Internet and Mobile Association of India (IAMAI) on Thursday told the Supreme Court (SC) that the Reserve Bank of India (RBI) had banned cryptocurrency on ‘moral grounds’ as there were no studies the banking regulator conducted to analyse if these virtual currencies were actually harmful or not.

In its challenge to the RBI’s circular barring banks from dealing in virtual currency, the IAMAI said while the underlying technology called blockchain was not in question, a total prohibition on cryptocurrency was uncalled for. The apex court, after hearing the submissions made by the IAMAI, asked it to prepare a chart and cite instances or judgments from other countries which have regulated cryptocurrency, instead of banning it.