Escrow accounts for FDI allowed without prior RBI approval, subject to prescribed operational conditions and compliance.
AD Category - I banks and SEBI authorised Depository Participants may open and maintain non-interest bearing Escrow accounts in Indian Rupees to hold consideration or securities for FDI transactions without prior Reserve Bank approval, subject to conditions: no credit facilities against balances; permitted credits are foreign inward remittances or rupee consideration from resident acquirers; permitted debits are remittance to beneficiaries or refunds on transaction failure; accounts limited to six months unless RBI permits extension; compliance with FEMA, SEBI regulations and KYC requirements is mandatory.

Pledge of shares for business purposes: AD Category I banks may permit non resident share pledges subject to compliance conditions.
Authorised Dealer Category I banks are delegated authority to permit non resident investors to pledge shares of Indian companies in conformity with the Foreign Direct Investment policy to secure credit. For pledges to Indian banks securing credit to the investee company, transfer on invocation must follow prevailing FDI policy, an auditor's declaration on utilisation of proceeds is required, SEBI disclosure norms must be observed, and pledges must comply with banking regulation. For pledges to overseas banks securing credit to non resident borrowers, loans must be from overseas banks, used abroad without capital inflow to India, transfers on invocation must follow FDI policy, and a CA/CPA declaration on utilisation is required.

Advance remittance liberalisation: raises threshold for mandatory standby letter of credit or bank guarantee, preserves discretionary waiver framework.
Authorised Dealer Category - I banks may accept advance remittances for imports without an unconditional, irrevocable standby Letter of Credit or international-bank-backed guarantee up to an enhanced threshold; above that threshold a bank guarantee (backed by an international bank where applicable) remains required, subject to specific Ministry of Finance waivers for Public Sector entities. Existing provisions allowing AD Category - I banks to waive guarantee requirements under an internal Board-approved policy for eligible importers remain unchanged.

FII investment in infrastructure corporate bonds expanded, with mandatory three-year lock-in and intra-FII trading permitted.
SEBI-registered Foreign Institutional Investors may increase their investment in listed non-convertible debentures and bonds issued by Indian corporates in the infrastructure sector as defined under ECB guidelines, within an enhanced sub-limit while preserving the overall corporate debt cap; such infrastructure bonds with residual maturity of five years or more will carry a mandatory three-year lock-in though trading among FIIs during lock-in is permitted, and FIIs may also invest in unlisted infrastructure corporate debentures/bonds subject to the same terms and FEMA compliance.

Irrevocable payment commitments permitted for custodians to settle FII share purchases, subject to bank exposure and compliance norms.
Custodian banks may issue Irrevocable Payment Commitments (IPCs) to stock exchanges/clearing corporations on behalf of FIIs for purchase of shares under the Portfolio Investment Scheme, subject to Reserve Bank regulations on banks' exposure to the capital market and existing DBOD instructions; amendments to the Guarantee Regulations will follow and AD Category I banks must inform constituents and ensure regulatory compliance.

Declaration of Intent requirement: EOUs may claim Chapter 3 benefits for past shipments without the declaration; authorities to finalise claims.
EOU shipments are not treated as free shipping bills by Revenue and the earlier DGFT clarification is withdrawn; EOUs may claim Chapter 3 benefits without a Declaration of Intent for exports made from 1 April 2008 to 31 December 2010. Regional Authorities must finalise rejected claims for that period and EOUs are allowed a one month grace period to file delayed claims. The post 1 January 2011 regime under Para 3.11.8 of HBP v1, as amended, remains in force.

Overseas forex trading restrictions bar remittances for internet portal trading; banks must block and report suspicious payment flows.
Residents are not permitted to remit funds for overseas foreign exchange trading through electronic or internet trading portals; foreign exchange derivative contracts are allowed only to hedge permissible underlying exposures, while currency futures and options on recognised domestic stock exchanges remain permitted subject to Reserve Bank directions. Banks must be vigilant against portals soliciting margin or investment payments via domestic accounts or cards, as such collections and remittances may contravene foreign exchange rules and KYC/AML obligations.

AML/CFT compliance required for money transfer agents: FATF guidance must be implemented and constituent notification mandated.
Indian agents under the Money Transfer Service Scheme are directed to implement AML and CFT measures for cross border inward remittances by considering the FATF Statement and the referenced Paragraph 5.10(b) guidance; they must notify their constituents and obtain acknowledgement from their Principal Officer to ensure compliance.

AML/CFT compliance required for money changing activities; authorised persons must implement FATF action-plan and note statutory penalties
Authorised persons engaged in money changing activities are directed to consider and implement the FATF action plan set out in the enclosed Statement, to notify their constituents, and to have their Principal Officer acknowledge receipt. Compliance with AML/CFT controls, including recordkeeping, client identification and reporting obligations, is mandated under the relevant foreign exchange and anti-money laundering statutes and rules; failure to comply will attract statutory penalties.

AML/CFT risk: Indian MTSS agents must assess and mitigate transactions involving jurisdictions with FATF strategic deficiencies.
Authorised Persons under the Money Transfer Service Scheme must apply enhanced Know Your Customer (KYC), Anti Money Laundering (AML) and Combating Financing of Terrorism (CFT) measures for cross border inward remittances, taking into account risks from jurisdictions identified by the Financial Action Task Force as having strategic AML/CFT deficiencies, incorporate those risks into customer due diligence and monitoring, notify constituents, and obtain Principal Officer acknowledgement; directions are issued under the regulatory foreign exchange and anti money laundering framework with attendant penalties for non compliance.

AML/CFT risk based due diligence required: consider jurisdictions with strategic deficiencies before entering business relationships.
Authorised persons in money changing activities must apply enhanced KYC and AML/CFT measures by assessing risks from jurisdictions identified by FATF as having strategic deficiencies and consider those risks when entering business relationships or transactions with persons or entities from such jurisdictions. These directions are issued under the Foreign Exchange Management Act and the Prevention of Money Laundering Act; non compliance may attract penal or regulatory consequences, and authorised persons should notify constituents and obtain acknowledgement from their Principal Officer.

Foreign exchange compliance: overseas acquisition of domestic card transactions for airline ticket sales must cease and be advised against.
Foreign exchange compliance concerning settlement of domestic card payments for airline ticket sales: overseas banks acquiring credit/debit card transactions originating in India and settling them abroad on behalf of foreign airlines is inconsistent with the Foreign Exchange Management Act, 1999 and related regulations permitting repatriation of ticket-sale surpluses only after payment of local expenses and taxes.

Export realisation period extended for exporters, allowing delayed repatriation of export proceeds under FEMA provisions.
The RBI extended, in consultation with the Government, the existing liberalisation permitting a longer period for realisation and repatriation of the full export value of goods and software, subject to review. The circular directs Authorised Dealer Category I banks to inform their constituents, preserves unchanged the provisions for units in Special Economic Zones and exports to overseas warehouses, and is issued under sections 10(4) and 11(1) of the FEMA, 1999.

Foreign contribution regulation: mandatory registration, exclusive bank accounts and strict reporting obligations for recipients.
The rules prescribe a comprehensive compliance regime for foreign contribution: applicants must obtain registration or prior permission via specified electronic forms with hard copy follow up and fees; maintain an exclusive bank account; submit annual audited returns certified by a chartered accountant; banks must report receipt transactions to the Central Government; and transfers, custody on cancellation, suspension utilisation limits, definitions of political and speculative activities, administrative expense rules, and prescribed forms and fees govern acceptance, use and oversight of foreign contribution.

Consolidated FDI Policy: framework for foreign investment instruments, entry routes, sector caps, reporting and enforcement.
The Consolidated FDI Policy (effective April 1, 2011) sets the framework for inbound non resident investment: permitted instruments, two entry routes (Automatic and Government), sectoral caps and conditions, valuation and pricing rules, 180 day issuance timing, conversion of ECB/royalty/import payables into equity, downstream/indirect investment calculation and ownership/control tests, transaction mechanics including Form FC GPR and FC TRS reporting, and enforcement under the foreign exchange regulatory framework with penalties, adjudication and compounding mechanisms.

Foreign direct investment: consolidation permits conversion formulas for convertibles and non cash equity issuances, easing investment rules.
Consolidated FDI Policy allows companies to use a conversion formula for pricing convertible instruments under FEMA/SEBI pricing rules; permits equity issuance against import of capital goods and pre operative expenses under the Government route; removes prior approval for investments in existing joint ventures/technical collaborations in the same field; simplifies downstream investment classification into foreign controlled and resident controlled companies; and allows FDI in seed development and production without controlled conditions.

Line of Credit conditions require majority Indian-origin supplies, specified disbursement periods, documentation and FEMA-based regulatory compliance.
The Exim Bank's Line of Credit to EBID finances exports of eligible Indian goods, services, machinery, equipment and consultancy to specified West African member countries, conditioning finance on Foreign Trade Policy eligibility, at least 85 per cent Indian-origin supply, up to 15 per cent external procurement for non-consultancy items, mandatory declaration on prescribed export forms, prohibition of agency commission under the facility except from exporter resources or EEFC balances subject to remittance rules, and procedural implementation through AD Category-I banks under FEMA while preserving other statutory permissions.

Annual Return on Foreign Liabilities and Assets introduced; companies must report FDI inflows and overseas investments annually.
The circular replaces Part B of Form FC GPR with a Annual Return on Foreign Liabilities and Assets to be submitted by Indian companies that received FDI or made overseas investments, using the prescribed format and definitions in the annexes, and directs AD Category I banks to notify their constituents; regulatory amendments under FEMA will follow.

Line of Credit to foreign government sets Indian supply content, export declaration and FEMA-based procedural conditions.
Exim Bank's Line of Credit to Malawi finances eligible goods, services, machinery and consultancy under India's Foreign Trade Policy, requiring at least 75% of contract value to be supplied from India and permitting up to 25% procurement from outside India (excluding consultancy). The Agreement sets distinct disbursement windows for project and supply contracts. Shipments must be declared on GR/SDF forms; no agency commission is payable under the LOC, though exporters may remit commission from own resources or EEFC balances after realization, subject to prevailing authorisations. The circular is issued under FEMA and without prejudice to other laws.

Micro credit: banks must mainstream SHG lending as priority sector with simplified procedures and discretionary interest rates.
The circular requires banks to treat the SHG-Bank Linkage Programme as a normal business activity and to report lending under a separate Advances to SHGs segment as part of priority sector lending, while permitting operational flexibilities on margin, security, documentation and savings linked loan ratios; banks must provide simplified procedures, delegate sanctioning powers to branches, train staff, monitor and review SHG lending with half yearly reports to NABARD and SLBC/DCC oversight.