REF: No. MPD. BC.239/07.01.279/ 2003-04

November 13, 2003
Kartika 22, 1925(S)

To

All Scheduled Commercial Banks
(excluding Regional Rural Banks)

Dear Sirs,

Reciprocal Line Facility

Please refer to circular No. MPD.BC.225/07.01.279/2002-03 dated November 14, 2002 exempting rupee resources drawn under Reciprocal Line Facility from the prudential limits specified for call/notice money transactions for a period of one year.

2. On a review, it has been decided that the exemption for rupee funds raised under Reciprocal Line Facility from the prudential limits specified for call/notice money transactions would be phased out from the fortnight beginning February 7, 2004. Accordingly, lending/borrowing in call/notice money market including transactions under Reciprocal Line Facility from the fortnight beginning February 7, 2004 should not exceed the prudential limits specified for this purpose.

3. To facilitate monitoring of your operations in call/notice money market on a daily basis, you are requested to continue to submit the daily return in time to the Principal Monetary Policy Adviser, MPD, RBI as per the extant practice.

Kindly acknowledge receipt.

Yours faithfully,

(D. Anjaneyulu)
Principal Monetary Policy Adviser