FDI Policy- Release of Foreign Exchange for Imports – Further Liberalisation

February 21, 2012:

Presently, applications by persons, firms and companies for making payments, exceeding USD 500 or its equivalent towards imports into India must be made in Form A-1.

The said limit has been reviewed and Reserve Bank of India has decided as a measure of liberalization to raise the above limit for foreign exchange remittance towards imports without any documentation formalities, from USD 500 or its equivalent to USD 5000 or its equivalent, with immediate effect.

Authorised Dealers (ADs) in foreign exchange now need not obtain any document, including Form A-1, except a simple letter from the applicant containing the basic information viz., the name and the address of the applicant, name and address of the beneficiary, amount to be remitted and the purpose of remittance, as long as :-



- the exchange being purchased is for a current account transaction
- the amount does not exceed USD 5000 or its equivalent
- the payment is made by a cheque drawn on the applicant's bank account or by a Demand Draft.



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