Evolution of FEMA
The government of India enacted the Foreign Exchange Regulation Act, 1973 (FERA) to tackle the foreign exchange crisis in the country. The purpose of FERA was to regulate foreign exchange dealings and other related activities to conserve the country’s foreign exchange reserves. The stringent FERA rules were not amenable to integrating the Indian economy into…
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Important FEDAI Rules about exchange rates, crystalisation extension and cancellation of contracts
FEDAI prescribes rules regarding trading hours, Exchange rate, Crystallization, of foreign currency, extension/cancellation of contracts etc. The FEDAI rules govern all Authorised Dealers of foreign exchange in India. Some of the important rules of FEDAI are as under. Trading Hours of Authorised Dealers (Rule 1): Exchange trading hours for interbank forex market in India would…
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Evolution of Reserve Bank of India Since 1935
‘Riksbank’ a joint-stock bank established in Sweden in the year 1668 is recognized as the world’s first central bank. The bank was commissioned to lend funds to the government and to act as a clearinghouse for commerce. But in the year 1897 the ‘Riksbank’ deserted commercial lending and it was granted a monopoly for issuing…
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RBI Issues 5th Amendment to SNRR Account in the FEMA (Deposit) Regulation 2025
A Special Non-Resident Rupee (SNRR) Account is opened with Authorized Dealer (AD) banks in India for specified transactions related to trade, foreign investments, External Commercial Borrowings (ECBs), and more. It serves as an alternative to executing inward/outward remittances in convertible foreign currency for each transaction with residents in India. This account allows non-residents with business…
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FEDAI rules related to import transactions
The FEDAI Rules (10th edition) for import transactions came in to force with effect from 01 April 2019. The FEDAI rule 3.1 deals with the application of exchange rate, rule 3.2 deals with the application of Interest, rule 3.3 deals with crystallisation of Import Bill under Letters of Credit as detailed below; Application of exchange…
FEDAI RULEs related to export transactions
The revised FEDAI Rules (10th edition) for export transactions came in to force with effect from 01 April 2019. The FEDAI rule 2.1 deals with Post shipment Credit in Rupees, Application of Interest, Normal Transit Period, Substitution/Change in Tenor, and Export Bills sent for collection. Post shipment credit in Rupees:The exchange rate for post-shipment Foreign…
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