DGFT Amends FTP 2023 to Broaden INR-Denominated Export Contracts and Export Benefits

The Directorate General of Foreign Trade has amended Paras 2.52 and 2.53 of the Foreign Trade Policy 2023 through Notification No. 30/2026-27 dated 20 August 2026. The change broadens the policy framework for export contracts and invoices denominated in Indian Rupees and for export proceeds realised in INR, while aligning the FTP with the applicable foreign-exchange regulations.

What has changed in Para 2.52

Under the revised framework, export contracts and invoices, other than those involving member countries of the Asian Clearing Union, may be denominated either in a foreign currency or in Indian Rupees. Export proceeds for these transactions may likewise be realised either in foreign currency or in INR.

The amendment retains separate treatment for ACU transactions. For ACU member countries other than Nepal and Bhutan, the applicable currency framework is to follow ACU arrangements and directions issued by the Reserve Bank of India. Transactions involving Nepal and Bhutan are to be denominated and settled in Indian Rupees or otherwise in accordance with RBI directions. The policy also continues to recognise INR denomination for transactions under EXIM Bank or Government of India Lines of Credit.

FTP benefits for INR export realisations

Para 2.53 has also been recast. Exports to countries other than Nepal and Bhutan can qualify for FTP benefits and incentives, and can count towards fulfilment of export obligations, where proceeds are realised in Indian Rupees through banking channels by credit to INR accounts of persons resident outside India opened under the applicable Foreign Exchange Management deposit regulations.

The effect is to place eligible INR export realisations on a comparable footing with foreign-currency realisations for FTP benefits and export-obligation purposes, subject to the prescribed banking and foreign-exchange framework. For exports to Iran, the FTP continues to require compliance with Para 2.19.

Why this matters for exporters and finance teams

The amendment is relevant to exporters using or considering INR settlement, as well as finance, treasury and compliance teams responsible for documentation under export-promotion schemes. Contract denomination, invoice currency, banking route and evidence of realisation all need to be consistent with the revised FTP and the governing FEMA framework.

Professionals handling Advance Authorisations, EPCG obligations or other FTP benefits should review how INR receipts are mapped to export realisation records and scheme documentation. The change does not remove the need to comply with RBI directions or the underlying foreign-exchange regulations.

Immediate action points

- Review export contract and invoice templates where INR settlement is contemplated.

- Confirm that the receiving banking arrangement is permitted under the applicable FEMA regulations.

- Map INR export realisations correctly to FTP incentive claims and export-obligation records.

- For ACU countries, Nepal, Bhutan and Iran, check the special conditions before relying on the general INR framework.

Takeaway: Notification No. 30/2026-27 materially broadens recognition of INR-denominated and INR-settled exports under FTP 2023. Exporters can benefit from the greater flexibility, but the documentation and banking route remain central to compliance.

Key takeaway

Fresh policy amendment with direct implications for exporters, finance teams and professionals handling export incentives and export obligations.