In a move that underscores its commitment to facilitating smoother international trade operations, the Reserve Bank of India (RBI) has announced new measures to ease the compliance burden on exporters, importers, and merchanting traders. These changes, outlined in the Statement on Developmental and Regulatory Policies dated October 01, 2025, aim to enhance operational flexibility and streamline processes that have often been a source of friction for stakeholders.
A. Greater Flexibility in Merchanting Trade Transactions (MTT)
One of the key announcements pertains to Merchanting Trade Transactions (MTT) — a vital segment for Indian traders operating in global markets. These transactions involve Indian entities acting as intermediaries between foreign suppliers and buyers, without the goods entering Indian borders.
In response to growing global trade uncertainties and feedback from the trading community, the RBI has extended the permissible time period for the foreign exchange (forex) outlay in MTT from four months to six months. This change, announced via A.P. (DIR Series) Circular No.11 dated October 01, 2025, offers Indian merchants additional leeway to manage their international trade cycles, especially in volatile or disrupted global markets.
This extension is expected to significantly help businesses in managing inventory risks, logistical delays, and payment flows more efficiently — a welcome move for sectors that rely on complex multi-country trade chains.
B. Simplified Closure Process for Shipping Bills and Bills of Entry
Compliance and reconciliation of export and import documentation have long posed operational challenges for businesses, particularly small and medium enterprises (SMEs). To address these concerns, the RBI had earlier released draft Directions on July 11, 2025, focused on easing the reconciliation process for small-value export transactions in the Export Data Processing and Management System (EDPMS).
Taking the industry feedback into account, the RBI has now expanded the scope of these simplified processes. The revised Directions will now also include small-value import transactions that are reported under the Import Data Processing and Management System (IDPMS).
By simplifying the process for closure and reconciliation of such transactions, the RBI aims to reduce the compliance burden on both exporters and importers, enabling faster resolution of outstanding entries and minimizing unnecessary follow-ups or penalties.
This initiative is particularly impactful for businesses handling high volumes of low-value transactions, such as in the textile, handicraft, and electronics sectors. It removes procedural bottlenecks and allows firms to focus on their core operations rather than grappling with administrative hurdles.
Looking Ahead
These latest updates are part of RBI’s broader efforts to create a more business-friendly environment in line with India’s vision to enhance its role in global trade. By extending timelines and simplifying compliance procedures, the central bank is not only reducing red tape but also supporting the long-term competitiveness of Indian traders.
For businesses engaged in export, import, or merchanting trade, these changes signal a more pragmatic and responsive regulatory approach — one that balances oversight with operational ease.