MUMBAI — Foreign Currency Non-Resident (Bank) [FCNR(B)] deposit mobilization under the new scheme has progressed at an unprecedented pace, estimated to have crossed the 2013 benchmark level of $26 billion in just around 45 days, according to the latest SBI Ecowrap report authored by Group Chief Economic Adviser Dr. Soumya Kanti Ghosh. Official Reserve Bank of India data showed total inflows reaching $20.72 billion by July 17, 2026, driven by $17.41 billion in FCNR(B) deposits alongside Overseas Foreign Currency Borrowings ($1.97 billion) and External Commercial Borrowings ($1.34 billion). Public sector banks have led this drive by leveraging client relationships and offshore-onshore strategies. The report projects that total FCNR(B) inflows could reach $65–70 billion by the end of the scheme on September 30, 2026, pushing overall capital inflows to $80–85 billion and turning India's FY27 Balance of Payments into a surplus of over $50 billion. Addressing market queries regarding the lag in Foreign Currency Assets growth relative to deposit mobilization, the study clarified that individual banks swap these foreign deposits with the RBI on designated schedules, resulting in a gradual reporting reflection that is expected to boost reserve figures by $10–12 billion in late July.
Despite robust capital inflows, continued depreciation and volatility in the Indian Rupee remain significant concerns due to West Asian geopolitical tensions, energy price fluctuations, and cautious foreign portfolio investments. Utilizing an econometric Censored Tobit model to evaluate the central bank's foreign exchange intervention, SBI Research found that the RBI's average intervention of $14 million per day during depreciation episodes was statistically significant but insufficient to curb exchange rate volatility or prevent further slide. In contrast to historical interventions during 1997–98 averaging $55 million per day, the current quantum of intervention remains inadequate relative to the $676 billion reserve stock. The report emphasizes that an aggressive, full-throated foreign exchange intervention strategy is required to break the self-fulfilling cycle of rupee depreciation and stabilize market expectations ahead of the scheme's closure.