CURRENT AFFAIRS | 30 APRIL 2026
CLAT GK + Economy / Banking
Indian importers paid for goods worth nearly $1.5 billion (approximately ₹14,057 crore) in Indian Rupees — not dollars — in February 2026 alone, fresh Reserve Bank of India (RBI) data shows. The figure is the single largest monthly INR-import-settlement print since RBI’s October 2022 framework opened the door to rupee-denominated foreign trade. The push, advocated by RBI Deputy Governor T Rabi Sankar in his April 8 reports, is the long-term gamble that even small forex savings, repeated monthly, harden India’s external account.
The numbers also flag a sobering reality: in the eleven months from April 2025 to February 2026, only 2.35% of India’s overall imports were INR-settled — down from 45% in the same period a year earlier, when India-Russia oil trade in rupees was at its peak. Despite the slowdown, total INR-settled imports in the first eleven months of FY 2025-26 still cross $15 billion at current rates.
What Happened
According to the RBI’s monthly bulletin, ~$1.5 bn worth of imports were invoiced and settled in INR in February 2026. The settlement was routed through Special Rupee Vostro Accounts (SRVAs) that 30+ partner countries’ correspondent banks have opened with Indian banks. The rupee, which had slumped to 95.24/$ in March 2026 amid offshore speculation, recovered to close February near 91/$ after RBI curbs on speculative trades.
The Background
India’s INR internationalisation push formally began in October 2022 when RBI announced an additional arrangement for “invoicing, payment, and settlement of exports/imports in INR“. Foreign banks were permitted to open SRVAs with authorised Indian banks, and surplus rupee balances could be invested in Indian government securities. The motivation: cushion India against US-dollar volatility, save scarce foreign exchange, and reduce transaction costs for traders, especially with sanctioned countries (Russia) and small partners.
Constitutional & Legal Framework
- Article 246 + Seventh Schedule, Union List Entries 36, 37 & 43 — currency, coinage, foreign loans, and banking are exclusively Union subjects.
- RBI Act, 1934 — establishes the Reserve Bank as the central monetary authority; regulator of forex.
- Foreign Exchange Management Act (FEMA), 1999 — replaced FERA 1973; governs all cross-border payment, settlement and capital flows; INR-trade-settlement rules are issued under FEMA.
- Banking Regulation Act, 1949 — empowers RBI to regulate Indian banks operating SRVAs.
- State Bank of India v. Union of India & allied cases — affirm the RBI’s wide regulatory discretion in monetary policy.
Why This Matters
For an oil-importing economy, every rupee saved on dollar-purchases reduces the Current Account Deficit (CAD) and protects forex reserves. Rupee internationalisation also lays the groundwork — slowly — for the INR to become a partial reserve currency in the Global South. But the model has limits: foreign exporters often dislike receiving INR (limited usability outside India), and the policy is a long, slow grind, not a switch.
CLAT 2027 — Why You Must Know This
This story is high-yield for Current Affairs + GK (RBI policies, FEMA), Legal Reasoning (RBI Act, regulatory authority of central banks), and Economy (BoP, CAD, exchange rate). Expect a passage-based question quoting the RBI bulletin and asking you to identify the correct statutory framework (FEMA), the correct constitutional list (Union List), or the correct functional difference between Current and Capital Accounts.
Key Facts at a Glance
| FRAMEWORK ANNOUNCED | October 2022 (RBI A.P. (DIR Series) Circular) |
| FEB 2026 INR IMPORTS | ~$1.5 bn / ₹14,057 crore |
| PARTNER COUNTRIES | 30+ (incl. Russia, UAE, Sri Lanka, Bangladesh) |
| SRVA-AUTHORISED BANKS (INDIA) | 26 banks; 156 vostro accounts (Feb 2025 baseline) |
| FY26 TOTAL (11 MONTHS) | ~$15 bn imports settled in INR |
| REGULATOR | RBI (under RBI Act 1934 + FEMA 1999) |
| RBI GOV / DEP. GOV | T Rabi Sankar (Deputy Gov, leading the push) |
Mnemonic
SRVA = Special Rupee Vostro Account. Remember: “Vostro = Yours-with-us” (foreign bank’s INR account held with an Indian bank).
Test Your Knowledge — 10 Question Quiz
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Practice Quiz — 10 CLAT-Style Questions
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Source: The Indian Express, 30 April 2026.
