The Reserve Bank of India has no plans to ease the restriction on net open position (NoP) that it has put on banks to reduce the pressure on the rupee, governor Sanjay Malhotra said.
Replying to a question at the post-policy media conference, Malhotra said there is no proposal currently before the central bank to discontinue the measure it had announced at the end of March.
“There is no change, whatever is there is there. There is no proposal to discontinue what we announced and implemented,” he said.
On March 27, the RBI limited lenders’ net open rupee positions in the non-deliverable forwards (NDF) market to $100 million. This measure was aimed at arresting the plunge in the rupee, which lost the most in 14 years through a volatile fiscal year ended March 2026, to end up at the bottom of the currency leader board in Asia.
NoP is the overnight unhedged exposure held by a bank in India. Before RBI's dictate, banks used to calculate their open positions after netting off their hedged bets in the overseas NDF market. For example, a $10 million dollar purchase in India could be hedged by selling dollars in the NDF market in the future, which meant the bank had no open position to speak of. With the RBI putting a $100 million daily cap for overnight onshore deliverable rupee positions, banks are no longer able to net off these trades with the offshore NDF.
