Borrowings – Loans, Overdrafts from/to Non Resident
Indians/ Persons of Indian Origin
Reserve Bank of India has issued two Regulations under FEMA, 1999 covering aspects relating to non-resident Indians concerning their borrowings, loans, overdrafts in India. They are: (i) Foreign Exchange Management (Borrowing or Lending in Foreign Exchange) as notified by Notification No.3/2000RB dated 3rd May 2000 as amended from time to time, (ii) Foreign Exchange Management (Borrowings and Lendings in Rupees) Regulations, 2000 as notified by Notification No.FEMA.4/2000-RB dated 3rd May 2000 as amended from time to time.
Use of Credit Card in India by Non-Residents
The use of Credit Card in India by a person resident outside India shall not be deemed as borrowing or lending in rupees.
Withdrawal of general permission to Overseas Corporate Bodies.
The Reserve Bank of India has notified the Foreign Exchange Management [Withdrawal of General Permission to Overseas Corporate Bodies (OCBs)] Regulations, 2003 [Notification No.G.S.R.836(E), dated 3.10.2003] and have derecognized the Overseas Corporate Bodies (OCBs) and accordingly have issued following directions to all authorized persons relating to borrowings from/to an OCB.
- no person resident in India shall borrow from, or lend to, an OCB either in foreign exchange or in Rupees;
- where any borrowing from or loan to an OCB, whether in foreign exchange or in Rupees made in accordance with the Regulations as applicable, is outstanding on the date of commencement of these Regulations, such borrowing or loan shall not be renewed on becoming due, and no interest thereon shall accrue after it falls due for repayment.