Draft note favours rupee payments for SEZ services provided domestically

The government has released a draft note that proposes to allow rupee payments for services provided by Special Economic Zones (SEZs) to domestic entities. This change would simplify the payment process for SEZs, as they currently have to receive payments in foreign exchange for services supplied to domestic customers. The move aims to boost the growth of SEZs and promote domestic trade, potentially benefiting the Indian economy.

Why it matters

The draft note may reduce demand for foreign exchange. This could lead to a stronger rupee as fewer dollars are needed for SEZ services.

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