The Reserve Bank of India, grappling to support the beleaguered rupee, is weighing a plan for state-owned lenders to sell foreign-currency bonds to draw capital inflows, according to people familiar with the matter.

Reserve Bank of India officials discussed a proposal that would see lenders issue foreign-currency bonds, potentially with five-year maturities, the people said, asking not to be named as the talks are private. Discussions are preliminary and no decision has been made, they said.

The central bank also considered offering foreign-exchange swaps to participating lenders to hedge currency risk, allowing them to offer more attractive yields to investors, the people said. Under such a structure, banks would be able to buy foreign currency from the RBI at a future date at a pre-determined price, they said.

An RBI spokesperson didn’t immediately respond to an email seeking comment on the matter. State-owned lenders report to the finance ministry, which often coordinates with the central bank on policies and measures to stabilize the currency.

The rupee has weakened close to 6% against the dollar this year, the worst performance in Asia. While anti-speculative measures rolled out by the central bank in March and April briefly helped the currency, pressure is building up again as oil prices remain elevated, exerting strain on the fuel-importing nation’s trade deficit. Stock outflows also exceeded $5 billion last month.

India has used similar tools before to attract inflows. State Bank of India raised $5.5 billion through so-called India Millennium Deposits in 2000, issuing bonds denominated in dollars, euros and pounds.

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Published on May 5, 2026