The Reserve Bank of India has lifted existing limits on banks' participation in foreign currency-rupee swaps.
According to a statement issued on Saturday, the central bank said banks can now offer foreign currency swaps without any limits in order to facilitate customers to hedge their forex liabilities.
The central bank has also given banks the freedom to invest any amount, as decided by its management, in overseas money market and debt instruments.
It has also doubled the forward contracts limit for exporters and importers, and permitted them to book up to the average of their past three years' turnover subject to an overall limit of $100 million.
Corporates have also been allowed full freedom to rebook cancelled contracts under one year without any limit, the RBI media release said.