Hedging of commodity price and freight risk permitted abroad with conditions; banks must ensure due diligence and reporting.
Eligible resident entities (other than individuals) may hedge commodity price risk and freight risk in overseas markets using permitted products; gold hedges are limited to recognised IFSC exchanges. Banks may authorise and remit for such hedges after due diligence on exposure, hedge tenor and quantity, justification for OTC or non identical benchmarks, board approved hedging policy and requisite risk management. OTC contracts must be with regulated counterparties in acceptable jurisdictions, structured products are subject to net worth and listing conditions, all payments must pass through designated special accounts, and banks must maintain records, obtain annual statutory auditor certification, report irregularities and submit quarterly XBRL returns.

Hedging of Commodity Price Risk enabled for overseas markets; banks to facilitate under RBI directions and enclosed master direction.
RBI directs Authorised Dealer Category I banks to facilitate hedging of commodity price risk and freight risk in overseas markets by their customers, within the framework of existing foreign exchange derivative regulations, and encloses a Master Direction detailing operational, eligibility, documentation and reporting modalities; the Directions are issued under statutory powers and are without prejudice to permissions under other laws.

Hedging of gold price risk now permitted on IFSC exchanges for eligible residents, subject to regulatory permissions.
Resident entities are permitted to hedge price risk of gold on exchanges in the International Financial Services Centre (IFSC) recognised by the International Financial Services Centres Authority, subject to eligibility and operational conditions in the Master Direction. The Master Direction Foreign Exchange Management (Hedging of Commodity Price Risk and Freight Risk in Overseas Markets) Directions, 2022 has been issued to implement this change; the directions are issued under statutory authority and remain without prejudice to any other legal permissions required.

Government backed Line of Credit enables India sourced export supply for Mauritius metro project, subject to RBI and FEMA compliance.
A Government of India supported Line of Credit from Exim Bank to SBM (Mauritius) finances participation in Phase IV of the Mauritius Metro Express Project, permitting exports from India subject to the Foreign Trade Policy. The LoC mandates at least 75 per cent of contract value be supplied from India and allows up to 25 per cent foreign procurement; shipments must be declared in Export Declaration Form/Shipping Bill. No agency commission is payable under the LoC, though exporters may use their own funds or EEFC balances after realisation, subject to AD Category I bank compliance. The circular is issued under FEMA and does not affect other legal permissions.

Short-Term Line of Credit enables financing for rice purchases from India subject to Indian-supply content and procedural compliance.
Exim Bank provided a Short-Term Line of Credit to Banco Exterior de Cuba to finance rice procurement from India, permitting exports of eligible goods and services subject to the Foreign Trade Policy. At least 75 per cent of the contract price must be supplied from India and up to 25 per cent may be procured abroad. The facility is subject to an eight-month terminal utilization period; shipments must be declared in Export Declaration Form/Shipping Bill. No agency commission is payable under the STLoC, and AD Category I banks must notify exporters and permit commission remittances only after realisation and compliance with extant rules. Directions are issued under FEMA.

Late Submission Fee for FEMA reporting: uniform calculation matrix with capped liability and prescribed opt in window for delayed filings.
A uniform Late Submission Fee (LSF) matrix applies to FEMA reporting delays: periodic/non-flow returns incur a fixed LSF while transactional/flow returns attract a fixed component plus a variable component equal to a percentage of the amount involved ('A') multiplied by the years of delay ('n'), with 'n' rounded upwards to the nearest month. The maximum LSF is capped at the amount involved, rounded to the nearest hundred. The opt-in facility for LSF is available up to three years from the reporting due date, and failure to submit or pay LSF exposes the person to penal action under FEMA; provisions take immediate effect for eligible delayed filings.

Extension of FCRA registration validity: pending renewals remain valid until renewal disposal, refusal causes deemed expiry and restrictions.
Entities with pending renewal applications whose validity had been previously extended shall have their FCRA registration certificates extended until the earlier of the end of March 2023 or disposal of the renewal application; similarly, entities whose five year validity expires in the October-March window and that apply for renewal before expiry will receive the same extension, while a refusal of renewal causes the certificate to be deemed expired on the date of refusal and bars receipt or utilisation of foreign contribution.

Line of credit support enables financing of Uzbekistan social infrastructure, subject to export eligibility and supply content rules.
A Government of India supported Line of Credit through Exim Bank finances Uzbekistan social infrastructure projects; exports must meet Foreign Trade Policy eligibility, be declared in Export Declaration Form/Shipping Bill per RBI instructions, and observe a minimum 75% India supply content (up to 25% external procurement). The LoC became effective September 12, 2022, with a terminal utilization period of 60 months from scheduled project completion. No agency commission is payable under the LoC, though exporters may use personal or EEFC funds for commissions subject to AD Category I bank approval after realization and applicable rules. AD banks must notify exporters and refer them to Exim Bank for details. Directions are issued under FEMA without prejudice to other statutory approvals.

Rupee Drawing Arrangement now permits use of BBPS for inbound bill payments to biller bank accounts, subject to KYC.
The circular authorises modification of the Rupee Drawing Arrangement to permit foreign inward remittances received under that arrangement to be credited to the bank account of the biller through the Bharat Bill Payment System (BBPS), subject to the procedural conditions and KYC requirements applicable to RDA transfers through other electronic modes, and directs Category I Authorised Dealer banks to notify constituents.

Line of Credit conditions mandate majority Indian sourcing and RBI procedural compliance for project export financing under FEMA.
Exim Bank's Government of India supported Line of Credit finances the Parliament building project in Eswatini subject to Foreign Trade Policy eligibility and Exim Bank approval. At least 65 per cent of contract value must be sourced from India, with remaining procurement permitted abroad. Shipments require Export Declaration Form/Shipping Bill filing per RBI instructions. No agency commission is payable under the LoC, though exporters may remit commission from their own funds or EEFC balances after realization, subject to AD Category I bank compliance. Directions are issued under FEMA without prejudice to other approvals.

Overseas investment regime clarified: new rules streamline permissions, reporting and introduce late submission fee for delays.
The Directions operationalise the new Overseas Investment regime, replacing JV/WOS with the concepts of foreign entity and Indian entity, introducing strategic sector exceptions, and clarifying ODI/OPI definitions. They streamline permissions by widening the automatic route and dispensing with approvals for specified transactions, set procedures and documentation obligations for approval route cases via designated AD banks and online reporting (Form FC/ODI/OPI) with UIN allotment, define aggregation and treatment of financial commitments (including guarantees, pledges and ECB/EEFC/ADR/GDR reckoning), and establish reporting, compliance and Late Submission Fee rules with penalties and restrictions on further remittances until regularisation.

External Commercial Borrowings limit increase expands automatic route and raises funding cost ceiling for investment grade borrowers.
The circular increases the automatic route annual limit for eligible External Commercial Borrowings and raises the all in cost ceiling by one percentage point; the enhanced all in cost ceiling is available only to borrowers with investment grade ratings from Indian credit rating agencies while others remain subject to the existing ceiling. The relaxations are time limited, require AD Category I banks to notify constituents, amend Master Direction No.5, and are implemented via amendments to FEMA borrowing regulations under the powers conferred by the Foreign Exchange Management Act.

International trade settlement in Indian rupees enabled via Special Rupee Vostro Accounts, subject to approvals and compliance.
AD banks may open Special Rupee Vostro Accounts for correspondent banks to enable invoicing, payment and settlement of exports and imports in INR; exchange rates are market determined. Indian importers shall pay into these accounts and exporters shall be paid from their balances. Usual trade documentation, reporting and Master Direction conditions apply for advances, set offs and bank guarantees. AD banks must obtain Reserve Bank approval, verify correspondent bank jurisdictions against FATF guidance, and comply with FEMA reporting; the instructions are effective immediately.

Settlement currency flexibility: Indo Sri Lanka trade and current account transactions may be settled outside the ACU in permitted currencies.
Indo Sri Lanka current account and trade transactions may be settled outside the Asian Clearing Union (ACU) mechanism in any permitted currency until further notice. Category I Authorised Dealer banks must implement this change immediately, inform their constituents, and note that the circular operates under the Foreign Exchange Management Act while remaining subject to any other statutory permissions.

Overseas foreign currency borrowings can be used by AD Cat I banks for foreign currency lending, subject to ECB end use rules.
Authorised Dealer Category I banks may utilise funds raised from overseas foreign currency borrowings during the specified window for foreign currency lending to constituents in India, subject to the end use prescriptions applicable to External Commercial Borrowings and compliance with the Master Directions; the on lending permission subsists until maturity or repayment of the underlying borrowings.

FPI short-term investment relaxations permit temporary exemptions for certain debt securities, easing maturity and cap constraints.
The RBI exempted FPI investments in government securities and corporate bonds made between July 08, 2022 and October 31, 2022 from the 30% short-term investment limit until maturity or sale, and temporarily allowed FPIs to invest in commercial papers and non-convertible debentures with original maturity up to one year, thereby relaxing the one-year residual maturity requirement for corporate debt; these Directions take immediate effect.

Short-Term Line of Credit enables government-supported procurement finance for urea, with export declaration and utilization rules.
Exim Bank has extended a Government supported Short Term Line of Credit (STLoC) to Sri Lanka for procurement of urea fertilizer from India; exports must be eligible under the Foreign Trade Policy and shipments declared in the Export Declaration Form/Shipping Bill per Reserve Bank instructions. The STLoC's terminal utilization period is six months from signing, extendable by Exim Bank but not beyond twelve months. No agency commission is payable under the STLoC; exporters may pay commission from their own resources or EEFC balances after realization, subject to AD Category I bank compliance. Directions are issued under FEMA without prejudice to other statutory permissions.

Extension of FCRA registration validity granted for pending renewals until disposal or final refusal, which ends eligibility.
Certificates previously extended to 30.06.2022 with pending renewal applications, and certificates expiring during 01.07.2022-30.09.2022 where renewal was applied for before expiry, are extended until 30.09.2022 or until disposal of the renewal application, whichever is earlier. If a renewal application is refused, the certificate is deemed expired on the date of refusal and the association is ineligible to receive or utilise foreign contribution.

Discontinuation of return under Foreign Exchange Management Act removes non resident guarantee reporting obligation for authorised dealer banks.
The circular announces the discontinuation of the return "Details of guarantee availed and invoked from non-resident entities," removing the reporting obligation for Authorised Persons/Authorised Dealer banks effective from the quarter ending June 2022; the relevant Master Directions will be amended and AD banks are to notify their constituents, with the directions issued under FEMA regulatory powers and without prejudice to other statutory permissions.

Import of gold by qualified jewellers: advance remittances allowed through IFSCA authorised exchanges subject to due diligence and reporting.
Qualified Jewellers may import gold through IFSCA authorised exchanges using exchange approved payment mechanisms; advance remittances must be supported by sale contracts or irrevocable purchase orders, used only for bona fide imports and not leveraged, with unutilised amounts refunded if imports do not materialise. AD banks must perform due diligence, ensure complete customs documentation and matching of Outward Remittance Messages with Bills of Entry, and report transactions through prescribed monitoring and reporting systems. IFSCA will vet exchanges and ensure systems prevent misuse of advance remittances.