Understanding Foreign Currency Convertible Bonds (FCCBs): A Hybrid Capital-Raising Instrument
Foreign Currency Convertible Bonds (FCCBs) are hybrid financial instruments that combine features of both debt and equity. Issued by companies seeking to raise capital from international markets, FCCBs are denominated in a foreign currency and offer investors the option to convert their holdings into equity shares of the issuing company under specified conditions. Key Features…
Read article Role of FEDAI (Foreign Exchange Dealers’ Association of India) and FEDAI rules
The Foreign Exchange Dealers’ Association of India (FEDAI) was established in 1958 as an association of banks dealing in foreign exchange in India—commonly referred to as Authorised Dealers (ADs). FEDAI operates as a self-regulatory body and is incorporated under Section 25 of the Companies Act, 1956 (now Section 8 of the Companies Act, 2013). FEDAI’s…
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Overview: FEDAI with Other Regulatory Organisations in India
With the increasing globalization of financial markets and ongoing deregulation, the role of self-regulatory organizations like FEDAI has evolved significantly. Today, FEDAI plays a catalytic role in ensuring the smooth functioning of India’s foreign exchange markets by fostering collaboration among key stakeholders, including: Here is a structured comparison of FEDAI with other key financial market…
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Derivative Products in India: RBI and FEDAI Guidelines
IntroductionDerivatives are critical financial instruments used for hedging, speculation, and risk management. In India, the regulatory framework for derivative products is governed by the Reserve Bank of India (RBI) and supported by the Foreign Exchange Dealers’ Association of India (FEDAI). In January 2022, the RBI issued updated Master Directions on OTC derivatives, establishing a modern…
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Foreign Exchange Management Act, 1999 (FEMA): Overview and Key Provisions
The Foreign Exchange Management Act, 1999 (FEMA) was enacted by the Indian Parliament to consolidate and amend the law relating to foreign exchange. Its primary objective is to facilitate external trade and payments, and to promote the orderly development and maintenance of the foreign exchange market in India. FEMA came into force on June 1,…
India’s Exchange Control Framework: An Overview
India’s exchange control regime is primarily governed by the Foreign Exchange Management Act, 1999 (FEMA). This legislation regulates foreign exchange transactions with the objective of facilitating external trade and payments while promoting the orderly development and maintenance of the foreign exchange market in India. The Reserve Bank of India (RBI), in consultation with the Government…
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