Establishment of foreign branch and liaison offices in India regulated under FEMA with specified eligibility, approvals and compliance requirements.
The Master Direction consolidates FEMA rules for foreign entities establishing BO/LO/PO in India: eligibility criteria (financial track record, net worth, sectoral restrictions), application procedure via Form FNC to a designated AD Category I bank with Reserve Bank UIN allotment where required, specified validity and extension rules, operational controls on bank accounts and permitted activities, mandatory Annual Activity Certificates with auditor scrutiny, conditions for remittance of profits and project remittances, procedures for transfer of assets and closure, and AD bank obligations on due diligence, reporting and compliance.

Foreign exchange rules for insurance govern issuance, premium remittance and claim settlement across resident and non resident parties.
Consolidated directions regulate issuance, premium collection, claim settlement, reinsurance and overseas accounts for life, general and health insurance under FEMA and IRDAI rules: residents may hold foreign insurer policies subject to RBI/LRS/IRDAI permissions; foreign currency policies and premium collections are permitted in defined situations; claims settlement in foreign currency is allowed under specified documentary and beneficiary conditions; reinsurance and foreign currency accounts for insurers follow board-approved programmes and IRDAI compliance.

Foreign exchange remittance rules govern current account transactions, card use, approvals, and compliance for residents and other persons.
Miscellaneous current account remittance facilities are governed by FEMA, the Current Account Transactions Rules, and RBI directions to authorised dealer banks and authorised persons. The framework covers release of foreign exchange, card usage, surrender and retention of unspent foreign exchange, travel and salary remittances, medical payments for NRI close relatives, and remittances by other persons for gifts, donations, consultancy, pre-incorporation expenses, technical collaboration, trademarks, franchises, and tour arrangements. It also preserves prohibitions on lottery-related remittances, Nepal and Bhutan transactions, and other prohibited current account uses, while requiring declarations, Form A2, document retention, KYC compliance, and tax-law observance.

Liberalised Remittance Scheme limit governs permissible resident remittances abroad with KYC, PAN and documentation requirements.
The Liberalised Remittance Scheme permits resident individuals to remit funds abroad up to the specified annual limit for permitted current and capital account transactions. Authorised Dealers must obtain Form A2, verify PAN and KYC, maintain due diligence and reporting, refuse suspected contraventions, and not extend credit to facilitate capital remittances. Permitted uses include travel, gifts, education, medical treatment, studies, certain overseas investments and loans/gifts to NRI/PIO relatives subject to prescribed conditions. Funds or income from overseas investments must be repatriated and surrendered within the stipulated period unless reinvested.

Borrowing and lending in Indian Rupee between residents and NRIs governed by FEMA and RBI directions on permitted use and repayment.
Borrowing and lending in Indian Rupee between residents and NRIs/PIOs are regulated under FEMA and RBI Master Directions. Authorised dealers may grant INR loans to NRIs against securities or immovable property for permitted purposes, subject to use restrictions, non remittance of loan proceeds abroad, prudential norms, and repayment by inward remittance or debit to specified non resident accounts. Housing loans, corporate staff loans, and interest free loans by resident individuals are allowed under defined conditions. Changes in borrower/lender residency trigger prescribed repayment or account crediting mechanisms. Temporary overdrafts in INR by authorised dealers to overseas branches are permitted within an aggregate ceiling.

External Commercial Borrowings (ECB) framework sets routes, eligibility, limits, and reporting requirements for overseas loans.
The Master Direction sets the consolidated ECB framework prescribing three tracks (foreign currency medium term, long term, and Rupee denominated), permitted forms and routes of borrowing, eligibility of borrowers and recognised lenders, minimum average maturities, all in cost ceilings, end use restrictions, hedging obligations, permissible security and guarantee structures, conversion to equity conditions, and comprehensive reporting and procedural requirements including Loan Registration Number and AD Category I delegated powers.

Compounding of FEMA contraventions permits RBI to settle quantifiable foreign exchange breaches upon compliant application and payment.
Compounding under FEMA permits the Reserve Bank to settle quantifiable contraventions on application, exercised by authorised RBI officers and delegated regional offices subject to exclusions for section 3(a), serious misconduct, or ongoing adjudication. Complete prescribed applications with annexures and undertakings must be submitted and the Compounding Authority assesses quantifiability, may call for documents, affords an opportunity of being heard, applies the guidance matrix to determine the payable amount considering factors like unfair gain and repetition, and issues a compounding order specifying contraventions and payment instructions; failure to pay invalidates the application.

Foreign exchange authorisation framework governs money changing business, compliance duties, and operational controls for authorised persons.
Money changing business may be undertaken only by persons authorised by the Reserve Bank under the Foreign Exchange Management Act, 1999, and unauthorised activity attracts penal consequences. The Master Direction consolidates instructions for Full Fledged Money Changers, non-bank Authorised Dealers Category-II, and related foreign exchange transactions, while preserving any additional permissions required under other laws. It also states that the Reserve Bank may issue further instructions through circulars and amend the Direction accordingly.

Rupee Drawing Arrangements govern inward personal remittances via vostro accounts under strict funding, KYC and monitoring requirements.
Master Direction sets the regulatory framework for Rupee Drawing Arrangements and Rupee/foreign currency vostro accounts of non resident Exchange Houses with AD Category I banks, requiring bank due diligence on Exchange Houses, separate credit only accounts funded by sale of permitted foreign currency or DDA mechanics, prohibition of overdrafts and transfers, specified permissible inward remittance uses, mandated KYC/AML/CFT compliance, and distinct DDA, Non DDA and Speed Remittance procedures with corresponding audit, reporting and collateral regimes.