This is a just as a clarification required with respect to Foreign Exchange Management (Borrowing or Lending in Foreign Currency) Regulations. We find that the regulation deals mostly with Borrowing in Foreign Currency. Can we be advised of the provisions laid down for Lending in foreign currency by an Indian company to a foreign entity.
Can an Indian Company extend a loan to a foreign entity? If such loans are permitted, we would like to know the guidelines/procedures prescribed.
Indian Companies Lending in Foreign Currency: Consult Authorized Dealer or Refer to Notification No. FEMA 3/2000-RB for Guidelines. A query was raised regarding the Foreign Exchange Management (Borrowing or Lending in Foreign Currency) Regulations, specifically about the provisions for Indian companies lending in foreign currency to foreign entities. Two responses were provided. One suggested consulting the Authorized Dealer or the Reserve Bank of India for clarification. The other recommended referring to Notification No. FEMA 3/2000-RB dated 3rd May 2000, which outlines the conditions under which entities other than authorized dealers can remit foreign currency loans. (AI Summary)
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