Foreign banks to provide upfront loans for Indian dollar deposits

SINGAPORE: Foreign banks will provide upfront financing for wealthy non-resident Indian clients to entice them to place bulky dollar deposits back home in response to India’s drive for dollar funding to defend its weak currency, sources told Reuters.

This would resurrect a practice which proved successful in drawing in dollars from non-resident Indians in 2000, when the rupee was also under pressure, and the sources said banks could raise about US$10bil or more.