The Reserve Bank of India (RBI) on Friday announced several policy measures to boost capital inflows into India, in a move seen to boost support for the rupee and put an end to the growing chatter surrounding their inability to protect the currency. 

Economists and corporates said the timing of the moves were appropriate but added that at this stage it would be too early to assess how much money could be raised through ECB and FCNR(B) offerings. 

The rupee has come under pressure in recent months against the dollar, down around 6% in 2026 itself. This has been largely due to the heavy demand for dollars because of rising crude oil prices and also hurt by sustained foreign fund outflows. The rupee on Friday reacted to these announcements, appreciating against the dollar to 95.38 on Friday, from 95.7 on June 4. 

RBI Governor Sanjay Malhotra said that he was confident that he expected “healthy flows” of foreign capital into India. “But we are not targeting any specific amount,” he told the media after the policy announcement. 

The RBI has expanded the Fully Accessible Route (FAR) for government securities by including all new issuances of 15-, 30- and 40-year tenor G-secs. This facility was earlier open only for a 10-year issuance.  

The Governor also said a facility of concessional forex swap will be provided till September 30 to incentivise External Commercial Borrowings (ECBs) by public sector banks. 

The central bank also said a similar facility for bearing the full hedging cost shall be provided till September 30, to authorised dealer banks for raising fresh 3 to 5-year FCNR(B) deposits. 

“While these measures are expected to strengthen our balance of payments, we will continue to make the right policy adjustments to further promote exports and attract and incentivise capital inflows,” Malhotra said in his speech, posted on the RBI website. 

“The RBI has done everything that was asked for. These moves will help address BoP and bridge the gap,” Sakshi Gupta, principal economist at HDFC Bank told Fortune India. She said that while the RBI kept interest rates unchanged, the policy should be seen as hawkish due to the inflationary risks which the central bank spoke about. 

Siddharth Rajpurohit, vice president and lead analyst (banking and non-lending financials) at Systematix Group, said the FAR announcement is “significant” to attract more foreign capital, deepen the bond market, support the rupee, and ease government borrowing costs amid global uncertainties. 

On the ECB announcement he said: “This is a targeted incentive by the RBI to encourage PSUs to raise ECBs in foreign currency. A concessional forex swap means the RBI will offer PSUs a favourable swap arrangement (typically a buy/sell swap) where it provides dollars at a lower effective cost than the market, reducing the currency hedging or overall borrowing expense.” 

Kaustubh Gupta, CIO (Fixed Income), Aditya Birla Sun Life AMC said the package to boost foreign capital is significant because it addresses capital flows through targeted measures. “The expansion of the FAR universe and removal of FPI investment restrictions should improve the attractiveness of Indian government securities for global investors, particularly long-term institutions.” 

“The concessional swap facility for ECBs can encourage overseas borrowing by corporates and PSUs, while the FCNR(B) measures may incentivise banks to mobilise foreign currency deposits. Collectively, these steps can diversify sources of foreign capital, strengthen external financing conditions, support government borrowing and improve liquidity in domestic financial markets.” 

“The RBI's measures should help improve the balance of capital flows and reduce pressure arising from the capital account,” Gupta added.