Why RBI is focusing on Offshore Rupee Markets ........

Economic and Social Issues International Funding institutions

The Reserve Bank of India has constituted a task force on offshore rupee markets to look into issues related to the markets and recommend appropriate policy measures to ensure the stability of the external value of the rupee."Offshore" refers to a location outside of one's national boundaries, whether or not that location is land- or water-based. Hence, Offshore Rupee market is a rupee denominated market in international market.The panel will study the causes behind the development of the offshore rupee market and examine the effects of the offshore markets on the rupee exchange rate and market liquidity in the domestic market.The panel will recommend measures to generate incentives for non-residents to access the domestic market and examine the role if any, International Financial Services Centres (IFSCs) can play in addressing these concerns.

Why RBI is focusing on Offshore Rupee Markets?

To decrease the falling rates of Rupee in the market

To encourage NRI’s to invest in Indian markets

Ensure a stable market for Indian products globally

Establish more bonds in the International Market

Better investment of rupee

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Explanation:

RBI is focusing on offshore rupee markets because:The Reserve Bank of India has constituted a task force on offshore rupee market to find ways to move non-resident Indian to the domestic market and improve liquidity to promote on-shore hedging activity.The task force will examine offshore rupee markets in depth and recommend appropriate policy measures that also factor in the requirement of ensuring the stability of the external value of the rupee.