RBI released Draft Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2024 and direction for public response under section 47 of the Foreign Exchange Management Act (FEMA), 1999.
Key Highlights of the draft regulation
- Every exporter shall furnish to the specified authority a declaration specifying the amount representing the full export value of the goods or services.
- Amount representing the full export value of goods and services shall be realized and repatriated to India within nine months from the date of shipment (goods) and invoice (services).
- Authorized Dealer may extend the specified period for reasonable and sufficient cause.
- No advance remittance for the import of gold and silver shall be permitted unless specifically approved by RBI.
Significance of the draft
- Intended to promote ease of doing business, especially for small exporters and importers.
- Empowers Authorized Dealer banks to provide quicker and more efficient service to their foreign exchange customers.
- Regulations are in line with the progressive liberalization policies governing foreign exchange transactions, under FEMA.
About FEMA, 1999
- Aimed to consolidate and amend the law relating to foreign exchange, facilitate external trade and payments for promoting the orderly development and maintenance of foreign exchange market in India.
- It also established Directorate of Enforcement (ED) to investigate cases under the Act.