Foreign currency accounts: non diplomatic embassy staff with official passports permitted to maintain deposits under amended FEMA rules.
Regulation No.4(3) was amended by Notification No.FEMA 78/2002-RB to permit non diplomatic staff of foreign embassies who are nationals of the sending State and hold official passports to maintain foreign currency deposit accounts; Authorised Dealers may therefore allow diplomatic missions, diplomatic personnel and such non diplomatic embassy staff to maintain foreign currency deposit accounts in India.

Salary remittance rules permit foreign and deputed Indian employees to remit part of salary abroad subject to rupee payment.
Nationals of foreign states resident in India employed by foreign companies, and Indian citizens on deputation to foreign employers' Indian offices, may open and maintain foreign currency accounts abroad to receive part of their salary by credit to such accounts, subject to a limit on the portion remitted, payment of the balance in Indian rupees in India, and applicability of Indian taxes on the entire salary. Authorised Dealers must notify constituents; directions issued under the foreign exchange statute and RBI notification.

Special currency basket rupee value fixed, requiring authorised dealers to update deferred payments records under FEMA.
Fixation of the rupee value of the special currency basket for Deferred Payments Protocols is announced, the valuation revised after a change on August 15, 2003 and made effective from August 19, 2003; Authorised Dealers are to note the adjustment previously referenced in the March 28, 2003 circular and inform their constituents. The directions are issued by the Reserve Bank of India under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999.

Advance remittance rules permit larger import pre-payments subject to bank guarantees or authorised dealer due diligence and policies.
Authorised Dealers may permit larger advance remittances for import of goods subject to security: amounts above the baseline require an unconditional, irrevocable standby Letter of Credit or a guarantee from a reputable international bank outside India, or an Indian Authorised Dealer's guarantee backed by an overseas counter guarantee; dealers may waive these requirements for non government importers with satisfactory track records under board approved internal guidelines; public sector entities have a specific waiver. Directions issued under Sections of the Foreign Exchange Management Act, 1999.

Derecognition of Overseas Corporate Bodies restricts fresh investments and new non resident accounts, with transitional retention rules.
The circular derecognises Overseas Corporate Bodies (OCBs) as an eligible investor class, barring them and unincorporated entities from fresh FDI (including Automatic Route) and from opening new NRE, FCNR(B) and NRO accounts. It prohibits OCBs from making fresh purchases of specified securities, participating in rights issues, transferring shares to other OCBs, and lending or accepting deposits under set conditions. Existing holdings and certain deposits may be retained until maturity, with repatriation of proceeds as authorised; disposal of non repatriable investments requires prior approval.

Foreign investment in exchange-traded derivatives allowed for approved FIIs; NRIs may invest non-repatriably subject to SEBI limits.
A registered Foreign Institutional Investor with valid approval may trade in SEBI-approved exchange-traded derivative contracts subject to SEBI-prescribed limits. A Non-Resident Indian may invest in SEBI-approved exchange-traded derivative contracts out of Indian rupee funds held in India on a non-repatriable basis, and such investments are not eligible for repatriation benefits.

Realisation and repatriation of export proceeds extended for designated countries under RBI authorization and FEMA provisions.
Extension of facility for realisation and repatriation of full value of exports of goods and software to a specified list of countries was authorised for a further one-year period from September 1, 2003 to August 31, 2004; directions issued under FEMA (Section 10(4) and Section 11(1)) require Authorised Dealers to inform constituents and note the annexed list of affected countries.

Line of credit financing conditions require lender reimbursement with importer co-payment under operative letters of credit and regulatory approvals.
The bilateral line of credit finances eligible exports of capital goods, spare parts, consultancy and project services from India to Suriname through approved contracts and operative letters of credit; reimbursements are provided by the State Bank of India against supporting documents and a negotiating bank certificate that the importer's direct payment has been received. Letters of credit must contain a specified reimbursement clause, shipments must be declared on prescribed export forms with a mandatory superscription, drawdown deadlines apply and agency commission is generally disallowed except on limited merit.

Non-resident share subscription permitted on rights basis, allowing additional allotments subject to sectoral cap and existing conditions.
Non-resident shareholders may apply for and be allotted additional equity shares, preference shares or convertible debentures beyond their rights entitlements on the same basis as resident shareholders, provided that total foreign investment in the company's paid-up capital remains within the applicable sectoral cap; all other terms and conditions of the existing rights-issue regulation remain in force.

Evidence of Import requirements raise verification thresholds for import remittances, altering documentary and reporting obligations.
Authorised dealers must obtain documentary evidence of import for remittances exceeding USD 100,000 and pursue follow up for non submission; only transactions above this threshold are to be reported in Form BEF. For remittances below USD 1,000,000, dealers may accept a Bill of Entry copy or a CEO/auditor certificate as proof of import, reflecting increased documentary thresholds under the foreign exchange statutory directions.

Amendments to foreign exchange regulations notify authorised dealers and supply amended notifications for implementation and constituent compliance.
Amendments to the Foreign Exchange Management Regulations, 2000 and related rules are notified to authorised dealers with copies of the RBI and Government notifications enclosed to enable implementation; authorised dealers must inform their constituents and effect operational changes in line with the enclosed amendments concerning EEFC accounts, exporter facilities, overseas borrowing and investment, resident foreign currency accounts, sponsored ADRs/GDRs, and Current Account Transactions.

Current account remittances allowed on self certification; dealers to accept self-declared purposes while ensuring authorised payment methods.
Authorised dealers may allow remittances for employment, emigration, education, maintenance of close relatives and medical treatment abroad based on self certification of purpose and basic transaction details, provided payment for foreign exchange is made by cheque, demand draft or debit to the applicant's account; the applicant remains responsible for the correctness of the information.

Forward cover restriction: authorised dealers must not offer forward contracts for Resurgent India Bonds to non-resident holders.
Authorised dealers must not offer forward foreign exchange contracts to Non-Resident Indians and Overseas Corporate Bodies for Resurgent India Bonds, as such investments are not eligible for forward cover and the original terms did not envisage availability of forward cover; dealers must notify their constituents and comply with the statutory exchange control directions.

Royalty payment liberalisation allows companies to pay royalties under the automatic route with registration and prescribed rates.
Liberalisation permits all companies irrespective of foreign equity to remit royalties on the automatic route at prescribed rates for export and domestic receipts, subject to prior registration with the Reserve Bank under the Foreign Exchange Management (Current Account Transactions) Rules, 2000; the ceiling on lumpsum fee/royalty under the automatic route continues to apply.

Merchanting trade credit restrictions: supplier/buyer short-term credit prohibited; import liability must be cleared by export receipts within prescribed period.
Merchanting trade transactions are not eligible for short term credit by suppliers' or buyers' credit. Authorised dealers must ensure import liabilities are extinguished by export receipts without delay and that the merchanting transaction is completed within six months.

Current account liberalisation broadens permissible remittances and simplifies documentation for residents, including medical and consultancy payments.
Authorised dealers may allow remittances up to the revised limits for employment abroad, emigration, maintenance of close relatives abroad and education abroad on the basis of self-declaration with basic transaction details and an Application in Form A2, with payment by cheque, demand draft or debit to the applicant's account; no supporting documents are required. Medical treatment remittances may be released up to an increased non-documentary threshold, and consultancy services remittances are permitted at a raised ceiling subject to documents satisfactory to the authorised dealer. Amendments to the Rules will be notified under the Reserve Bank's FEMA authority.

Export finance eligibility expanded to include capital goods and Exim Policy exports; authorised dealers must notify exporters.
Clarifies that Exim Bank Lines of Credit to foreign banking/financial institutions are not limited to illustrative lists; capital goods, plant and machinery, industrial manufactures, consumer durables and other items eligible under the Exim Policy may be financed. Authorised dealers must notify exporter constituents. Directions are issued under FEMA authority.

Capitalisation of import payables: shares may be issued against certain foreign currency payables subject to tax and procedures.
Policy now allows issue of equity shares to non residents against lumpsum fees, royalties and External Commercial Borrowings in convertible foreign currency already due for payment or repayment, subject to meeting all applicable tax liabilities and required procedures; previously issue was permitted only against inward remittance in convertible foreign exchange or debit to NRE/FCNR accounts.

Line of Credit for exports to Sri Lanka sets financing, shipment deadlines, declaration and commission conditions under exchange control.
A Line of Credit has been provided to a Sri Lankan bank to finance eligible Indian exports including capital goods and related services, requiring shipments to be declared on GR/SDF forms and letters of credit to be opened and utilised within prescribed terminal dates. Agency commission is generally disallowed but the Reserve Bank may permit limited commission for after sales service subject to prior approval and invoice deduction payment in the borrower's country, with the reimbursable finance amount adjusted accordingly. Directions are issued under the Foreign Exchange Management Act.

Royalty payment liberalization: companies may remit royalties on the automatic approval route without duration limits, subject to lump sum caps.
Policy permits all companies with foreign technology collaboration agreements to make royalty payments on the automatic approval route at the prescribed export and domestic rates without any restriction on duration, while retaining the existing ceiling on lumpsum fee and royalty payments under the automatic route.