Voluntary Retention Route permits FPIs to commit retained holdings in Indian debt for regulatory relaxations and allocation benefits.
The Reserve Bank introduces the Voluntary Retention Route (VRR) allowing SEBI registered FPIs to hold a Committed Portfolio Size (CPS) in Indian debt outside certain macro prudential norms, provided they retain at least 75% of CPS on an end of day basis for a minimum Retention Period (generally three years). Allocations are additional to General Investment Limits, made by tap or auction with an overall cap and tranche releases; custodians must monitor compliance, block repatriation that breaches thresholds, and report violations to SEBI.

FPI investment in municipal bonds permitted, subject to State Development Loan investment limits and existing debt market conditions.
Foreign Portfolio Investors are permitted to invest in municipal bonds, and such investment shall be reckoned within the limits set for FPI investment in State Development Loans. All other existing conditions for FPI investment in the debt market remain unchanged; Authorised Dealer Category I banks must notify their customers. Amendments to the relevant Foreign Exchange Management Regulations were notified on April 18, 2019, and the directions are issued under the statutory regulatory framework.

Line of Credit enables export financing under sourcing, reporting and remittance conditions for a Rwanda infrastructure project.
Exim Bank's Government-supported Line of Credit finances export of eligible goods and services for the Rwanda road project subject to Foreign Trade Policy eligibility, a minimum 75 percent India-sourcing requirement, a terminal utilization period from project completion, mandatory Export Declaration Form reporting, prohibition on agency commission under the LoC (with permitted exporter-funded commission from EEFC balances subject to realization and instructions), and AD Category I bank obligations to inform exporters and comply with FEMA-based directions.

Line of credit for export financing requires Indian supply content, export declaration, and regulated commission payments.
A Government supported Line of Credit to Rwanda finances specified SEZ projects through export contracts that must meet Foreign Trade Policy eligibility; at least 75% of contract value must be supplied from India with up to 25% procured abroad. Shipments must be declared in the Export Declaration Form. No agency commission is payable under the LoC, though exporters may use their own funds or EEFC balances for commission payments subject to realization and compliance. AD Category I banks must notify exporters, allow compliant remittances for commissions, and provide access to LoC details; directions are issued under foreign exchange management powers without prejudice to other required approvals.

Government supported Line of Credit to finance Rwanda agricultural projects; exports must be India sourced, declared in EDF, AD banks to notify exporters.
A Government of India supported Line of Credit by Exim Bank to Rwanda finances exports of eligible goods and services for three agricultural projects, requiring the majority of contract value to be supplied from India and the remainder to be procurable from outside India. Shipments must be declared in the Export Declaration Form; the Agreement is effective from the stated date with a defined terminal utilization period. No agency commission is payable under the LoC, though exporters may remit commission from their own resources or EEFC balances after realisation, subject to extant instructions and AD Category I bank oversight. Directions are issued under FEMA.

Foreign currency accounts access: re insurance and composite insurance brokers may hold non interest accounts for business transactions.
Re insurance and composite insurance brokers registered with the insurance regulator may open and maintain non-interest bearing foreign currency accounts with Category I Authorised Dealer banks in India for transactions in the ordinary course of their business; Authorised Dealers must inform constituents and the Master Direction on Deposits and Accounts will be updated to reflect this change, subject to other legal permissions.

NRO account eligibility expanded for LTV holders with visa, permit and quarterly reporting requirements to national authorities.
Authorized Dealers may allow SEBI registered FPIs and FVCIs to open non interest foreign currency accounts for investment. A single NRO Account may be opened for specified minority citizens of Bangladesh or Pakistan holding or applying for an LTV, subject to visa/permit validity, six monthly renewal where applicable, conversion upon Indian citizenship, and quarterly reporting of detailed account information to the Ministry of Home Affairs. SNRR accounts may operate beyond the seven year limit with RBI approval and are exempt from the seven year restriction for SEBI registered investors. Escrow Account rules in Schedule 5 have been replaced to align with the foreign investment regulations, permitting resident and non resident accounts and funding by guarantees.

Establishment of foreign offices: prior central bank approval waived where government sectoral licence or permission exists.
Prior Reserve Bank approval is not required to open a Branch Office, Liaison Office, Project Office or other place of business in India in the Defence, Telecom, Private Security and Information and Broadcasting sectors where government approval, licence or permission from the concerned ministry or regulator has been granted; defence-related Project Offices established pursuant to a contract with the Ministry of Defence, Service Headquarters or Defence PSUs likewise need no separate government reference. The term "permission" excludes general automatic-route FDI permissions; other BO/LO/PO conditions remain unchanged.

FPI investment limits revised for government securities and corporate bonds, reallocating increases and extending coupon reinvestment to state loans.
Revision increases FPI investment ceilings for FY 2019-20 across central government securities, SDLs and corporate bonds; incremental G sec allocation is split 50:50 between 'General' and 'Long term', SDL increases are allocated to SDL 'General', and the coupon reinvestment arrangement for government securities is extended to SDLs. AD Category I banks must communicate the circular to constituents; directions are issued under statutory powers without prejudice to other required permissions.

Trade Credit Framework clarified: permissible forms, security, hedging and mandatory monthly reporting to ensure FEMA compliance.
Master Direction consolidates RBI directives under FEMA for Trade Credits, specifying eligible forms, recognised lenders, permitted currencies and maturities, hedging expectations and all-in-cost ceilings. It details admissible security (bank/overseas guarantees, charges on movable/immovable/financial assets, corporate/personal guarantees) subject to loan security clauses, no objection certificates and compliance with FEMA/FDI/SEZ norms. AD Category I banks must assign unique IDs to TCs and submit consolidated monthly Form TC returns to RBI, ensure no double financing for SEZ transactions, verify maturity/operating cycle limits, and confirm borrowers' risk management and hedging arrangements.

Country code reporting under FETERS: banks must capture ultimate exporter/importer country and update R Return reporting workflows.
A two character country-code (SWIFT code) must be added to the end of the BoP file-format under FETERS to capture the ultimate exporter/importer country; for imports, a revised Form A2 must record the "Name of the country providing ultimate services" for specified purpose groups, and Authorised Dealers must update systems to report R Returns on a fortnightly basis accordingly.

Export and import of Indian currency: individuals may carry new Rs200 and Rs500 notes to Nepal/Bhutan within Rs25,000 limit.
Individuals travelling from India to Nepal or Bhutan may carry Indian currency notes in the Mahatma Gandhi (New) Series of Rs.200 and Rs.500 subject to an aggregate limit of Rs.25,000; currency notes up to Rs.100 remain allowable without limit. Authorised Persons must notify customers. The change is effected by amendment to the Export and import of Currency Regulations, 2015, notified in the Official Gazette and issued under the Foreign Exchange Management Act, without prejudice to other required permissions.

Trade credit framework updated: rules on currency, tenors, cost ceilings and reporting for import financing clarified.
The revised framework governs raising Trade Credits for imports under automatic and approval routes, permitting FCY or INR denominated suppliers' and buyers' credit to resident importers subject to eligibility of lenders, specified maturities by import type, an all in cost ceiling linked to a benchmark plus spread, currency conversion rules, hedging and risk management requirements, permitted security arrangements with safeguards, and mandatory monthly and quarterly reporting by AD Category I banks; ADs must ensure compliance and prevent double financing, with directions issued under FEMA provisions.

Hedging of exchange rate risk allowed for FPIs under Voluntary Retention Route subject to eligibility and operational conditions.
Permits hedging of exchange rate risk for Foreign Portfolio Investors under the Voluntary Retention Route using forwards, options, cost reduction structures and swaps with rupee as one currency, subject to operational conditions: dealers may offer contracts only where the FPI has VRR-related exposure; notional and tenor must not exceed exposure; duplicate hedging is prohibited; notional excesses must be adjusted unless due to market valuation; FPIs may cancel and rebook; payables must be met from repatriable funds or inward remittances.

Voluntary Retention Route enables FPIs to lock retained debt holdings in exchange for regulatory relaxations and hedging access.
The Reserve Bank introduces the Voluntary Retention Route allowing registered FPIs to invest in government or eligible corporate debt by accepting a Committed Portfolio Size and a Retention Period during which they must maintain a minimum proportion of the CPS on an end-of-day basis. Allocation is by tap or auction, with bids prioritised by retention period; limits constrain the share any single FPI or related FPIs may receive. VRR investments are additional to general limits, exempt from certain corporate bond restrictions, and permit limited repo use and derivative hedging. Custodians must monitor compliance and maintain separate accounts.

Foreign office establishment: FCRA-covered activities require FCRA registration and bar FEMA permission for such activities.
Entities seeking to establish a Branch Office, Liaison Office, Project Office or other place of business in India must not undertake activities covered by the Foreign Contribution (Regulation) Act, 2010 and must declare they will not do so; applicants engaged in FCRA activities must obtain FCRA registration and shall not seek permission under the FEMA Regulations. The Form FNC now contains a declaration that misrepresentation will render RBI approval void ab initio and subject to withdrawal.

FPI exposure limit removal expands investor access to Indian corporate bond market and permits higher single corporate allocations.
Withdrawal of the 20 per cent single corporate exposure cap for Foreign Portfolio Investors in corporate bond portfolios; the restriction in paragraph 4(f)(ii) of AP (DIR Series) Circular No. 31 is rescinded with immediate effect to broaden investor access to the Indian corporate debt market. The instruction is directed to Authorised Dealer Category I banks under Schedule 5 of the FEMA Regulations, 2017 and issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999, without prejudice to other legal permissions.

External Commercial Borrowings end-use relaxation allows resolution applicants to raise ECBs to repay rupee term loans under approval route.
The Reserve Bank permits resolution applicants under Corporate Insolvency Resolution Process to raise ECBs, excluding borrowings from branches/overseas subsidiaries of Indian banks, for repayment of rupee term loans of the target company under the approval route; proposals must be routed through Authorised Dealer Category I banks to the Foreign Exchange Department, Central Office, Mumbai, and all other ECB provisions remain unchanged.

External Commercial Borrowings framework expands eligible borrowers and streamlines automatic route approvals with strengthened reporting.
The circular replaces the prior multi track regime with a unified External Commercial Borrowings (ECB) framework distinguishing foreign currency and rupee denominated ECBs, broadens eligible borrowers to those entitled to receive FDI plus specified public and not for profit entities, and requires recognised lenders to be resident in FATF or IOSCO compliant jurisdictions. Compliant ECBs within prescribed parameters qualify for the automatic route subject to an annual limit, with designated AD Category I banks responsible for verification, mandatory Loan Registration Number prior to drawdown, monthly Form ECB 2 reporting, and payment of Late Submission Fees for delayed filings.

Defence manufacturing licensing: specified military platforms and munitions require licence and Form-VII approval before production or proof-testing.
The Press Note designates specific defence platforms and equipment that require an industrial licence under the Industries (Development and Regulation) Act, 1951, and identifies arms, ammunition and related materials that require a licence and Form-VII approval from DIPP for manufacturing and/or proof-testing under delegated powers from the Arms Act; it centralises licensing authority, defines covered categories and notes limited technical exclusions.