An association of consulting engineers on Thursday urged the government not to route foreign currency transactions within the country through the US banking system in order to reduce transaction costs.
The Association of Consulting Engineers of India (CEAI) has demanded that such transactions involving foreign currencies such as the US dollar in the country be channeled through the Reserve Bank of India.
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“Currently, transaction fees are levied on US dollar transactions in the country. As you know, when dealing in US dollars, pounds sterling or Japanese yen between two countries, the payment is routed through the corresponding banking system and a transaction fee is paid, ”said KK Kapila, chairman of the committee. business and policy, CEAI. .
“Transactions in US dollars within India, for example a payment in US dollars from Delhi to Hyderabad from one entity to another in the current exemption, must be made through the United States. This should be undertaken directly through the Reserve Bank of India and there should be no obligation to route them through the US banking system, ”he said.
By channeling transactions through the U.S. banking system, the country is losing substantial money, which goes to Americans in transaction fees, Kapila said. “Isn’t it a special scenario that one of the Indian banks sends dollars to the United States to collect them from another Indian bank?” In my opinion, as long as we are transacting in US dollars in India, there should be no transaction costs payable in the US, ”he added.
“It needs urgent correction, lest we keep losing every day. If it is part of a trade agreement, it needs to be urgently reviewed. Let this be treated as a priority, ”he added.