Forex Nre Nro Nri

Forex facilities for residents:
As per FEMA resident Indians are permitted to buy or sell foreign exchange
from Authorized Dealers (AD) s and full fledged money-changer (FFMC) for
permitted current account transactions. ADS can accept payment in cash
upto Rs.50,000/- against sale of foreign exchange. Releases of forex beyond
the limits mentioned below require RBIs approval.
Sr.No
.
1
2
3
Purpose
Amount
Tourism/private
visit
Out side of India.
$
10,000/
-
Details
Per financial year per family member

for one or more visits abroad. Visit to
all countries except Nepal and Bhutan
are eligible for this facility.
Gift/donation
out As per Per financial year. This facility is
side of India.
LRS.
subsumed under LRS scheme.
Employment,
$ 1 lac. To Indian resident going abroad for
Immigration,
gainful
employment/
to
meet
Education, medical
incidental expenses in the country of
treatment,
migration
on
production
of
maintenance
of
evidence/per
academic
year
of
close relative.
institute where admission has been
obtained./on basis of declaration by
the patient./ per year basis.
Business trip
$
Available per trip except Nepal and
25,000/ Bhutan.
It
covers
visits
for
international
trade
conferences,
seminars, training etc.
Small
value $
For any permissible transaction on the
remittances.
5000/basis of simple letter from the
applicant
without
insisting
on
submission of Form A-2.
Liberalized remittances scheme (LRS):

a) Resident Indian individuals are permitted to freely remit upto USD 2 lac
per financial year for any current or capital account transactions or a
combination of both.
b) LRS facility is in addition to the other remittances allowed.
c) Gifts/Donations are now included in LRS facility within the overall limit
of USD 2 lac. There is no sub-limit.
Fuller capital account convertibility- 2006:
Second committee chaired by S.S.Tarapore. Earlier committee on CAC in
1997 had put out a road map for full convertibility. The second committee on
FCAC submitted its report to RBI on 31 st July2006. They have recommended

a Road map for fuller convertibility within a broad frame work for five years
in three phases. 2006-07 (Phase-1) 2007-08 and 2008-09(Phase-2) and
2009-10 and 2010-11 (Phase-3).
Forex accounts for resident Indians.

Particulars
RFC account
RFC (D)
Who
can For returning Indians Resident
open
i.e. those who were individuals
An account NRI/PIO
Sources of By foreign inward
funds
remittances, transfer
of funds of FCNR (B),
deposits,
NRE
Deposits.
Type
of SB., CA, TD.
accounts
Currency
USD, GBP, EURO &
of
YEN.
accounts
Loans and Not permitted
overdrafts
Interest
Bank can decided
EEFC
A person resident in
India, which includes
individuals,
firms,
cos.
Foreign exchange Status
holder,
acquired while on Exporter individual,
visit to any place professional,
can
outside of India.
retain upto 100%
Current accounts
Current
accounts
and Time Deposits.
USD, GBP, EURO USD, GBP, EURO &
& YEN.
YEN.
Not permitted
Not permitted
No interest
Only
for
deposit
and
maxi. Upto $ 1
With maturity
31.10.2008.
term
can
mio.
upto
Non resident Indian (NRI) accounts:

1) Non resident Indian (NRI): An NRI is a person holding Indian passport. Gone abroad for a gainful employment or business or
vocation, or for any other purpose indicating an indefinite period
of stay outside of India.
Working abroad on foreign
assignments/employed by IMF, IBRD, UNO, UNESCO etc.
Employed in central or state government and public sector under
takings and deputed abroad on temporary assignments or for
temporary period.
2) Person of Indian origin (PIO): PIO means a citizen of any country
other than Bangladesh, or Pakistan. If he held an Indian passport at any point of time, or whose parent/s or grand parent/s
were citizens of India (Undivided India) or foreign national spouse

of an either NRI or PIO is given the status of PIO.
Power of Attorney in NRO Accounts:
1) Local payments in rupees including eligible investments.
2) Remittance outside India of current income of the account holder net of
applicable taxes.
Power of Attorney holders in NRE Accounts:
Allowed all transactions except the following.
1) Credit foreign currency notes and traveler cheques in NRE A/c can not
be accepted.
2) Repatriation except in favour of the principal i.e. NRI Account holder.
Bank accounts for Non-Resident Indians:
SR.N
O.
1.
PARTICULA
RS
Who can
open.
Currency of
the a/c.
NRO
NRE
FCNR[B]
NRI/PIO
NRI/PIO
NRI/PIO
INR
INR
3.
Source of
the funds.
Funds from
abroad.
4.
Accounts
Local or
funds from
abroad.
SB/CA/RD,TD
.
Foreign currency
USD,GBP,YEN,EURO,CAD,AU
D
Funds from abroad.
5.
Mini/maxi.
period
Mini. 1 year
Mini. 1 year and Maxi. 5 yrs.
Maxi. 3 years
6.
Joint
account
with
resident &
Nonresident.
Nomination.
Repatriation
As per
domestic
deposit
Permitted
with both
Resident and
Non
resident.
2.
7.
8.
permitted
Not
SB/CA/RD/TD
.
With resident
not
permitted
and with
non-resident
permitted.
permitted
Freely
Only Time Deposits.
With resident not permitted

and with non-resident
permitted
Permitted
Freely repatriable
9.
Tax
benefits.
10.
Interest
rates.
permitted
No tax
exemption
TDS @ 30%
For SB-3.5%
For T/Dbanks are
free to fix
the rate
repatriable
Exempted
from all
taxes.
For SB- 3.5%
linked with
domestic
rate and for
T/D- linked
with
LIBOR/SWAP.
Exempted from all taxes

T/D- Fixed or floating within
ceiling rate of respective
LIBOR/SWAP rate less 75
basis points.
Exchange control relating to exports:

Export import code Number [IEC]: Every person/ Firm/ Company engaged
in export business has to obtain an IEC Number issued by the Director
General of Foreign Trade.
Export Declaration Forms: Any export of goods from India that full value
of exports will be realized within prescribed period in the prescribed manner.
GR/SDF
Exports made otherwise than by post.
PP FORM
Exports made by Post Parcel.
SOFTEX
Exports of software in Non-Physical
FORM
forms.
Time limits for exporters to receive export payments:
1) Normal Exporters: 6 months.
2) Status holders, 100% Export Oriented Units, EHTP, STP (Software
Technology Park) etc. are permitted to realize and repatriate
within a period of 12 months from the date of export.
3) A unit in SEZ has no limit.
4) Extension to be sought from AD in form ETX.
Reporting to RBI: Half-yearly statement in form XOS which gives details of
all exports bills outstanding beyond six months from the date of export as at
the end of June and December.
Prescribed method: The payment for export proceeds should be received
through the medium of the Authorized Dealers (Ads). However, in
exceptional cases where the track record of the exporters is good, Ads can
accept the amount received by exporters direct by cheques, DD etc.
Submission of Export Documents: The exporter has to submit duplicate
copy of GR form along with the shipping documents to the AD within 21 days
of shipment. The AD s will report the export bills accepted for collection or
negotiation to RBI every fortnight in a statement call ENC along with R

return.
Crystallization of Export bills: Crystallization is a process of conversion of
foreign currency liability of customer in to rupee liability. Authorized dealers
are now free to fix the period after which crystallization has to take place
after taking in to consideration various risk factors such as the Credit risk of
Exporters, Operational risks etc.
a) TT selling rate on the date of crystallization or the original bill buying
rate, whichever is higher will be applied for crystallization .
b) Swap cost/gain for the period from due date of the bill to the date of
crystallization should be passed on to the exporter.
Application for exchange rates:
Selling
rates
TT selling
rates
Bill selling
rate.
TC/FX
Currency
Buying
rates
TT buying
rate
Bill buying
rate
TC/FX
Currency
Transactions.
a.
Outward remittance in foreign currency
(TT.MT.PO.DD.)
b.
Cancellation of purchase bills/DD etc.
c.
A forward purchase contract cancelled.
Transaction involving transfer of proceeds of import bills.
At the option of ADs.
Transactions.
Clean inward remittances (PO, MT, TT, DD) where cover is
already credited to ADs Nostro a/c. cancellation of FSC.
Purchase/Discounting of bills and other instruments. Where
bank has to claim cover after payment.
At the option of ADs.

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Forex Nre Nro Nri

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Forex facilities for residents:

Per financial year per family member

Liberalized remittances scheme (LRS):

FCAC submitted its report to RBI on 31 st July2006. They have recommended

Forex accounts for resident Indians.

Non resident Indian (NRI) accounts:

were citizens of India (Undivided India) or foreign national spouse

Only Time Deposits.

With resident not permitted

Exempted from all taxes

Exchange control relating to exports:

negotiation to RBI every fortnight in a statement call ENC along with R

Outward remittance in foreign currency

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