Circulars/Notifications - Exchange Policy Department  
 F.E. Circular No. 46
May 26, 1994 

AAll Authorized Dealers
In Foreign Exchange,

Dear Sirs,


Please refer to F.E. Circular No. 33 dated the 28th March, 1994 on the above subject.

2. In terms of para 8 of the Chapter on forward cover attached to the said F.E. Circular, in case an exporter books forward against an export contract, but draws a usance bill and presents it for discounting, the bank may discount the will at the rates published by the Foreign Exchange Rates Committee which are based on the spot rates minus the discount. The foreign currency receipts in respect of such discounted bills are not considered deliveries against forward contracts but the contracts are required to be closed out on maturity.

3. In order to provide the exporters the benefit of forward bookings, it has been decided that with effect from 26th May, 1994, Authorized Dealers may treat discounting of usance bills as delivery against the relative forward contract provided such bills are presented for discounting during the option delivery period only. The discount rate in such cases will be the forward rate of the contract less the usance period discount as prescribed for bill buying rate by the Foreign Exchange Rates Committee. With the discounting of the bill, the relative forward cover contract shall be deemed to have been taken up.

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