RBI's early FCNR(B) deposit scheme closure 'data-driven' or a policy U-turn? Governor Malhotra explains
- Posted on August 20, 2026
- By Business News Today
- 1 Views
- 1 min read
In brief
India's central bank governor justified the premature termination of the FCNR(B) deposit scheme as a strategic, evidence-based adjustment rather than a policy reversal. The decision reflects robust foreign currency inflows exceeding initial projections, prompting the RBI to recalibrate its monetary approach. By discontinuing the scheme ahead of schedule, authorities aim to channel approximately $80 billion into the Indian economy while simultaneously maintaining equilibrium in forex markets and controlling currency fluctuations amid evolving global economic conditions.
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RBI's early FCNR(B) deposit scheme closure 'data-driven' or a policy U-turn? Governor Malhotra explains
RBI Governor Sanjay Malhotra defended the FCNR(B) deposit scheme's early closure. He stated the decision was data-driven and a prudent calibration. This move aims to attract $80 billion into India's economy. The central bank cited stronger than expected dollar inflows for the adjustment. The RBI remains committed to managing exchange rate volatility and market conditions.
