Booking of Forward Contracts Based on Past Performance
Attention
of authorised dealers is invited to circular No. EC.CO.FMD/453/02.03.75/2001-02
dated December 1, 2001 and paragraph 3 of A.P.(DIR Series) Circular No. 63
dated December 21, 2002 on the captioned subject. Authorised dealers are
permitted to offer forward contracts to their importer/exporter constituents on
the basis of last 3 years average import/export performance subject to condition
that forward contracts outstanding at any point of time shall not exceed 25 per
cent of the eligible limit, within the cap of USD 100 million.
2. In order
to facilitate large corporates with proven track record and large import/export
turnover to effectively and actively manage currency risks arising out of
genuine exposures, Reserve Bank on application would consider permitting higher
limits for booking forward contracts on the basis of past performance without
submission of documentary evidence. Such forward contracts, booked under the
enhanced limit, will be on a deliverable basis.
3. Corporates
desirous of availing of higher limits may forward their applications, through
an authorised dealer, to the Chief General Manager, Reserve Bank of India, Exchange
Control Department, Forex Markets Division, Central Office, Mumbai-400 001 (Fax
No. 22611427, e-mail ecdcofmd@rbi.org.in) justifying the need for the higher
limits. Details of the import/export turnover of the past three years, delayed
realisations/payments during these years and existing limits, duly
authenticated by the authorised dealer, may also be furnished in the enclosed
format.
4. Authorised
dealers 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 Section 10(4) and
Section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999).
Statement
giving details of import/export turnover, overdues etc.
Name
of the constituent : .................................................................
(Amount
in USD million)
|
Financial Year (April- March) |
Turnover |
Percentage of overdue bills to turnover |
Existing limit for booking of forward cover based on past performance |
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|
Export |
Import |
Export |
Import |
Export |
Import |
|
2002-03 2001-02 2000-01 |
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