The Indian government’s efforts to boost dollar inflows have led to a surge in foreign lending, with the India Infrastructure Finance Company (IIFCL) planning to borrow $1 billion from overseas investors. The company is also exploring a separate $400 million funding from the Asian Development Bank (ADB) for a 20-year loan.
Rise in dollar inflows through the RBI’s FCNR(B) deposit scheme may limit gains in domestic gold prices. A stronger rupee could act as a cap on domestic gold prices, alongside broader trends in global bullion markets.
Indian government bonds are expected to extend gains in early deals on Tuesday, driven by a decline in oil prices and a series of measures by the Reserve Bank of India to attract dollar inflows. The RBI’s measures could nearly negate the pressure on the balance of payment for this financial year.
The Reserve Bank of India (RBI) has announced a move to ease the flow of foreign currency non-resident (bank) or FCNR (B) money into the country, boosting dollar inflows through direct banking channels.
