Guarantee prohibition prevents residents from guaranteeing debts owed to non residents without Reserve Bank permission or equivalent safeguards. No person resident in India shall give a guarantee or surety in respect of, or undertake a transaction, by whatever name called, which has the effect of guaranteeing, a debt, obligation or other liability owed by a person resident in India to, or incurred by, a person resident outside India, except as provided in these regulations or with the general or special permission of the Reserve Bank.