Rupee down 5.5% to record 95.33, RBI under pressure
The Indian rupee has dropped 5.5% this year, touching an all-time low of 95.33 per dollar.
With rising oil prices and capital leaving the country, partly due to tensions in the Middle East, the RBI is feeling the heat as foreign exchange reserves dip from $728.5 billion to $698 billion.
RBI mulls NRI scheme, bond tax
To boost dollar inflows, the RBI might revive a special deposit scheme for nonresident Indians (NRIs) that raised $26 billion back in 2013 and could also remove a 5% tax on foreign investments in government bonds.
These moves aren't final yet.
Even though India's reserves can cover 11 months of imports, about $104 billion is tied up elsewhere, making quick access tough.
Plus, equity outflows have already hit $20.6 billion this year, higher than all of last year, so the RBI is also asking oil companies to slow down on buying dollars right now.