Rashid (70-67-70) thus took his three-day total to nine-under-207, two strokes ahead of second-placed Vikrant Chopra, another Delhi golfer, who also fired a 70 today.
The overnight joint leader played a steady front-nine as he made nine straight pars. Rashid then picked up the pace with birdies on the 10th, 13th and 15th.
He made a couple of good chip-putts on the 10th and 13th and made an amazing recovery from the bushes on the 15th to land his shot within six feet of the pin. Khan's only blemish of the day came on the 16th where he three-putted from 20 feet and as a result dropped a bogey.
Rashid, a winner on the PGTI in 2011, said: "My hitting was not up to the mark today. I was hitting it better in the first two rounds. However, I made some good chip-putts and my short-game was quite sharp. I also recovered well from some difficult spots to save par on a few occasions. I'll look to convert my opportunities in the final round."
Vikrant Chopra (72-67-70) is likely to put up some stiff resistance against Rashid in the final round. Chopra, who is yet to win his maiden professional title, made four birdies and two bogeys in his third round effort of 70 to stay in the hunt.
Delhi's Shamim Khan (68-69-75), the overnight joint leader, slipped to third place after he fired a 75 in round three. Shamim's total stands at four-under-212.
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The Kolkata trio of Feroz Ali Mollah, Shankar Das and Divyanshu Bajaj share fourth place along with Lucknow's Vijay Kumar at three-under-213.
Coimbatore-based amateur S Sidhartha is in tied 22nd place at five-over-221.