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In this presentation, we will discuss about the procedure of importing goods, acquiring licenses, various types of licenses, import evidence, acquisition of foreign currency. WE will also discuss …

In this presentation, we will discuss about the procedure of importing goods, acquiring licenses, various types of licenses, import evidence, acquisition of foreign currency. WE will also discuss about the rules and restrictions of import and exports.
To know more about Welingkar School’s Distance Learning Program and courses offered, visit: http://www.welingkaronline.org/distance-learning/online-mba.html

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  • 1. Chapter No. 3 Page No. 42 International FinanceIMPORT / EXPORT CONTROL IMPORTS OF GOODS TODAY, PARTICULARLY THE IMPORT OF GOODS IS NOT UNDER CONTROL UNDER GLOBALIZATION. WHAT GOODS MAY BE IMPORTED, IN WHAT QUANTITIES, BY WHOM AND HOW, HOW EXPORTS CAN BE PROMOTED, WHAT INCENTIVES SHOULD BE OFFERED TO EXPORTERS etc. ARE LOOKED AFTER BY MINISTRY OF COMMERCE. FINANCIAL ASPECTS i.e. RATE OF EXCHANGE, METHODS OF PAYMENT, PERMITTED CURRENCIES, REMITTANCES AGAINST IMPORTS, etc. ARE CONTROLLED BY THE EXCHANGE CONTROL BY THE RESERVE BANK OF INDIA.
  • 2. Chapter No. 3 Page No. 42 International FinanceIMPORT / EXPORT CONTROL IMPORT TRADE CONTROL ADMINISTRATION: DIRECTOR GENERAL OF FOREIGN TRADE (DGFT) AND ITS REGIONAL OFFICES CONTROL OVER THE IMPORT OF GOODS. THE RULES AND PROCEDURES OBSERVED BY THE IMPORT CONTROL ARE CONTAINED IN THE HAND BOOK OF IMPORT-EXPORT PROCEDURES. OBJECTIVES: o THE MOST ESSENTIAL GOODS SUCH AS RAW MATERIALS SPARES etc ARE IMPORTED ON MERITS. o FOREIGN EXCHANGE PAID OUT, AN EQUIVALENT VALUE IN GOODS IS RECEIVED IN INDIA. o THE PRICE OF THE IMPORTS IS PAID OUT IN A PERMITTED METHOD OF PAYMENT.
  • 3. Chapter No. 3 Page No. 43 International FinanceIMPORT / EXPORT CONTROL IMPORT LICENCE IMPORT LICENCES ARE ISSUED BY THE OFFICE OF THE DIRECTOR GENERAL OF FOREIGN TRADE. LICENCE CONTAINS: A DESCRIPTION AND VALUE IN RUPEES OF THE GOODS TO BE IMPORTED. THE COUNTRY FROM WHICH IMPORT IS PERMITTED. THE DATE UP TO WHICH THE LICENCE WILL REMAIN VALID. IT IS ISSUED IN DUPLICATE , FIRST COPY FOR CUSTOMS PURPOSES AND THE SECOND FOR EXCHANGE CONTROL PURPOSES.
  • 4. Chapter No. 3 Page No. 43 International FinanceIMPORT / EXPORT CONTROL IMPORT LICENCE (EXCEPTION) UNDER IMPORT POLICY CONTROL, THE IMPORT OF SAMPLES IS ALLOWED WITHOUT AN IMPORT LICENCE WHERE--- THE VALUE DOES NOT EXCEED RS. 50,000. THE IMPORT IS MADE BY POST OR BY AIR FREIGHT. THE IMPORTER IS A REGISTRED MANUFACTURER- EXPORTER.
  • 5. Chapter No. 3 Page No. 44 International FinanceIMPORT / EXPORT CONTROL TYPES OF IMPORT LICENCE IMPORT LICENCE MAY BE ISSUED ON CASH BASIS OR ON DEFERRED PAYMENT BASIS. A DEFERRED PAYMENT LICENCE IS ISSUED ON CONDITION THAT THE PAYMENT AUTHORIZED UNDER THE LICENCE WOULD BE SPREAD OVER A PERIOD OF YEARS. FOR THE IMPORT OF CAPITAL GOODS IT IS AS (CG) AND FOR IMPORT OF HEAVY ELECTRICAL PLANT AS AN (HEP) LICENCE. AS INCENTIVES FOR CERTAIN SPECIFIED EXPORTS TO REGISTERED EXPORTERS SUCH LICENCES ARE KNOWN AS REPLENISHMENT (REP) IMPORT LICENCE. FOR THE IMPORT OF GOODS UNDER FOREIGN LOANS / CREDITS.
  • 6. Chapter No. 3 Page No. 45 International FinanceIMPORT / EXPORT CONTROL IMPORTS WITHOUT LICENCE IMPORT UNDER OGL: GOODS UNDER AN OPEN GENERAL LICENCE (OGL) DOES NOT REQUIRE ANY IMPORT LICENCE. PRIVATE IMPORTS: IMPORTS BY INDIVIDUALS OR INSTITUTIONS FOR THEIR OWN USE OF CERTAIN ARTICLES SPECIFIED UNDER THE IMPORT TRADE CONTROL ORDER / NOTIFICATION AND THE C.I.F. VALUE DOES NOT EXCEED THE PRESCRIBED VALUE. POSTAL IMPORTS: BY INDIVIDUALS, INSTITUTIONS OR HOSPITAL FOR THEIR OWN USE WHERE THE VALUE DOES NOT EXCEED U.S. $ 5000. IMPORTS INTO BONDS: GOODS TO BE EXPORTED ARE SOME TIMES IMPORTED AND KEPT IN BONDS. THROUGH REGISTERED COURIER: WHERE VALUE DOES NOT EXCEED THE SPECIFIED LIMIT.
  • 7. Chapter No. 3 Page No. 46 International FinanceIMPORT / EXPORT CONTROL EVIDENCE OF IMPORT THE IMPORTER SHOULD SUBMIT THE EXCHANGE CONTROL COPIES OF THE BILLS OF ENTRY OR THE POSTAL / COURIER WRAPPERS TO THE AUTHORIZED DEALER THROUGH WHOM THE REMITTANCE HAS BEEN OR IS TO BE MADE. THE AUTHORIZED DEALER SHOULD ACKNOWLEDGE THE RECEIPT OF THE EXCHANGE CONTROL COPIES. THE INTERNAL INSPECTORS / AUDITORS SHOULD MAKE A 100 % VERIFICATION OF THE EXCHANGE CONTROL COPIES. THE AUTHORIZED DEALER SHOULD FORWARD TO THE RESERVE BANK A STATEMENT AT THE END OF EACH CALENDAR QUARTER IN FORM BEF ALONG WITH THE COPIES OF THE BILL OF ENTRY WITHIN 15 DAYS FROM THE END OF THE QUARTER.
  • 8. Chapter No. 3 Page No. 47 International FinanceIMPORT / EXPORT CONTROL IMPORT OF GOLD, SILVER, JEWELLERY, FOREIGN EXCHANGE, INDIAN CURRENCY GOLD / SILVER: GOLD AND SILVER CAN BE IMPORTED UP TO A CERTAIN QUANTITY BY PERSONS OF INDIAN NATIONALITY OR ORIGIN, SUBJECT TO CONDITIONS AND ON PAYMENT OF THE PRESCRIBED DUTY IN FOREIGN EXCHANGE. IMPORT OF PERSONAL JEWELLERY: PERSONAL JEWELLERY MADE OF GOLD OR SILVER IS ALLOWED UNDER THE CUSTOMS BAGGAGE RULES FREE OR ON PAYMENT OF DUTY. CONT…..
  • 9. Chapter No. 3 Page No. 47 International FinanceIMPORT / EXPORT CONTROL IMPORT OF GOLD, SILVER, JEWELLERY, FOREIGN EXCHANGE, INDIAN CURRENCY IMPORT OF SECURITIES: THERE ARE NO RESTRICTIONS ON THE IMPORT INTO INDIA OF ANY SECURITIES WHETHER INDIAN OR FOREIGN. IMPORT OF INDIAN CURRENCY: THE IMPORT OF INDIAN CURRENCY IS PERMITTED UNDER THE RESERVE BANK’S NOTIFICATION NO. FERA 81/89 RB DATED. 9-8-89 SUBJECT TO CONDITIONS. IMPORT OF FOREIGN EXCHANGE: THE RESERVE BANK HAS PERMITTED THE IMPORT PROVIDED IT IS DECLARED TO CUSTOMS AUTHORITIES ON ARRIVAL THE PARTICULARS OF ALL SUCH FOREIGN CURRENCY BROUGHT ON THE CURRENCY DECLARATION FORM CDF.
  • 10. Chapter No. 3 Page No. 48 International FinanceIMPORT / EXPORT CONTROL IMPORTS UNDER FOREIGN CURRENCY LOAN / CREDIT ANY FOREIGN CURRENCY LOAN OR CREDIT, SUCH AS BUYER’S CREDIT, SUPPLIER’S CREDIT, OR A LINE OF CREDIT GRANTED BY A FIRM, COMPANY, LENDING INSTITUTION OR BANK FOR FINANCING IMPORT OF GOODS, TECHNOLOGY ETC, OR FOR ANY OTHER PURPOSE OTHER THAN EXCEPTING CERTAIN CATEGORIES REQUIRES PRIOR PERMISSION OF THE GOVERNMENT OF INDIA AS WELL AS OF THE RESERVE BANK.
  • 11. Chapter No. 3 Page No. 50 International FinanceIMPORT / EXPORT CONTROL ACQUISITION OF FOREIGN CURRENCY / EXCHANGE a. RESERVE BANK PERMITS ANY PERSON TO ACQUIRE FOREIGN EXCHANGE. BY WAY OF SCHOLARSHIP OR STIPEND FROM A CHARITABLE TRUST OR EDUCATIONAL INSTITUTION OR FOUNDATION OR FROM A FOREIGN GOVERNMENT TO ENABLE HIM TO UNDERGO A COURSE OF STUDY OR TRAINING OR BOTH. BY WAY OF INCOME FROM ASSETS HELD OR BY WAY OF INHERITANCE, SETTLEMENT OR GIFT. BY WAY OF REMUNERATION FOR SERVICES RENDERED OR IN SETTLEMENT OF ANY LAWFUL OBLIGATION. CONT….
  • 12. Chapter No. 3 Page No. 50 International FinanceIMPORT / EXPORT CONTROL ACQUISITION OF FOREIGN CURRENCY / EXCHANGE b. THE PROVISION WILL NOT APPLY TO PERSONS OUTSIDE INDIA IN RESPECT OF FOREIGN EXCHANGE EARNED BY THEM BY WAY OF REMUNERATION FOR SERVICES RENDERED OUTSIDE INDIA UNTIL THEY CEASE TO BE RESIDENT OUTSIDE INDIA. c. WHEN SUCH FOREIGN EXCHANGE IS BROUGHT OR SENT TO INDIA THE PERSON BRINGING OR THE PERSON RECEIVING IT, SHALL , BEFORE THE EXPIRY OF 7 DAYS FROM THE DATE WHEN IT IS BROUGHT OR RECEIVED, OFFER IT FOR SALE TO AN AUTHORIZED DEALER.
  • 13. Chapter No. 3 Page No. 50 International FinanceIMPORT / EXPORT CONTROL OPENING OF L / C FOR CUSTOMERS ONLY: A LETTER OF CREDIT MAY BE OPENED BY A BANKER ON BEHALF OF A CUSTOMER WHO MAINTAINS AN ACCOUNT WITH HIM AND KNOWN TO BE PARTICIPATING IN THE PARTICULAR TRADE. FOR IMPORTS UNDER OGL: WHERE THE GOODS ARE COVERED BY AN OPEN GENERAL LICENCE. FOR IMPORTS UNDER LICENCE: WHERE THE GOODS ARE TO BE IMPORTED AGAINST A SPECIFIC IMPORT LICENCE ON PRODUCTION OF THE “FOR EXCHANGE CONTROL PURPOSE” COPY OF THE IMPORT LICENCE. CONT….
  • 14. Chapter No. 3 Page No. 52 International FinanceIMPORT / EXPORT CONTROL OPENING OF L/C AMOUNT: A LETTER OF CREDIT FOR THE IMPORT OF GOODS COVERED BY AN OGL MAY BE FOR ANY AMOUNT, WHILE AN L/C FOR THE IMPORT OF GOODS AGAINST AN IMPORT LICENCE MUST NOT BE FOR AN AMOUNT EXCEEDING THE VALUE OF THE GOODS SPECIFIED IN THE LICENCE. PERIOD: FOR IMPORTS UNDER OGL, THE PERIOD OF THE L/C MUST NOT BE LONGER THAN THE VALIDITY PERIOD OF THE RELATIVE OGL. FOR L/C OPENED UNDER AN IMPORT LICENCE, THE DATE OF EXPIRY MUST NOT BE LATER THAN 75 DAYS. PAYMENT: THE LETTER OF CREDIT MUST PROVIDE FOR PAYMENT ONLY AGAINST THE DELIVERY OF SHIPPING DOCUMENTS. CONT….
  • 15. Chapter No. 3 Page No. 53 International FinanceIMPORT / EXPORT CONTROL OPENING OF L/C UNDER AN f.o.b. CONTRACT FREIGHT PAID BY THE EXPORTER IS RECOVERABLE AND THE SAME SHOULD BE STIPULATED IN THE L/C. WHERE AN L/C IS ESTABLISHED FOR THE IMPORT FOR GOODS FROM TWO OR MORE COUNTRIES UNDER A SPECIFIC LICENCE, THE AMOUNT OF CREDIT SHOULD BE STATED SEPARATELY. THE OPENING OF AN L/C FOR IMPORT INTO BOND FOR EXPORTS REQUIRES THE PRIOR APPROVAL OF THE RESERVE BANK. CONT….
  • 16. Chapter No. 3 Page No. 53 International FinanceIMPORT / EXPORT CONTROL OPENING OF L/C A LETTER OF CREDIT AGAINST AN IMPORT LICENCE ISSUED FOR THE IMPORT OF GOODS UNDER A FOREIGN LOAN / CREDIT MAY BE OPENED WITHOUT REFERENCE TO THE RESERVE BANK. MARGIN: THE MARGIN ACCEPTED AGAINST A LETTER OF CREDIT MUST BE RETAINED IN RUPEE AND NOT CONVERTED INTO ANY FOREIGN CURRENCY UNTIL THE BILLS ARE DRAWN. PURCHASE OF SHIP: IF THE L/C IS AGAINST THE PURCHASE OF A SHIP FROM ABROAD THE BANKER SHOULD VERIFY THAT THE PURCHASER HAS OBTAINED THE APPROVAL OF THE MINISTRY OF TRANSPORT, GOVT. OF INDIA.
  • 17. Chapter No. 3 Page No. 53 International FinanceIMPORT / EXPORT CONTROL RESTRICTIONS NO OPENING DURING GRACE PERIOD: NO L /C SHOULD BE OPENED DURING THE GRACE PERIOD OF THE LICENCE. REVOLUTION CREDIT: THE OPENING OF A REVOLVING CREDIT FOR IMPORTS IS NOT PERMISSIBLE. BENEFICIARY: AN L/C MAY BE OPENED ONLY IN FAVOUR OF THE MANUFACTURER, SUPPLIER OR SHIPPER OF THE GOODS OR IN FAVOUR OF AN OVERSEAS BUYING AGENT OF THE IMPORTER PROVIDED THE RESERVE BANK’S PERMISSION HAS ALREADY OBTAINED. NO READY EXCHANGE : THE OPENING OF A “CASH” LETTER OF CREDIT INVOLVING AN IMMEDIATE SALE OF READY FOREIGN EXCHANGE AGAINST SHIPMENT TO BE MADE AT A FUTURE DATE IS NOT PERMISSIBLE. CONT….
  • 18. Chapter No. 3 Page No. 54 International FinanceIMPORT / EXPORT CONTROL RESTRICTIONS UNDER CONTRACT WITH GOLD CLAUSE: A LETTER OF CREDIT FOR THE IMPORT UNDER A CONTRACT CONTAINING A “GOLD CLAUSE” FROM ANY COUNTRY IN THE FORMER BILATERAL GROUP OTHER THAN ROMANIA, POLAND AND CZECK AND SLOVAKIA , MAY BE OPENED ONLY WITH THE PRIOR APPROVAL OF THE RESERVE BANK. ON EXPIRY OF LICENCE: IF AN IMPORT LICENCE EXPIRES BEFORE SHIPMENT IS MADE, THE LETTER OF CREDIT SHOULD NOT BE EXTENDED UNTIL THE LICENCE IS REVALIDATED. ANOTHER’S GUARANTEE / MARGIN: NO CREDIT SHOULD BE ESTABLISHED AGAINST AN IMPORT LICENCE, ON BEHALF OF THE HOLDER OF THE LICENCE AGAINST A GUARANTEE OFFERED OR MARGIN DEPOSITED BY A PERSON OTHER THAN THE CUSTOMER IN WHOSE NAME THE CREDIT HAS TO BE OPENED.
  • 19. Chapter No. 3 Page No. 55 International FinanceIMPORT / EXPORT CONTROL EXPORT CONTROL THE EXPORT OF GOODS EXCEPT TO NEPAL AND BHUTAN IS UNDER CONTROL. THE MAIN PURPOSES OF CONTROL ARE:1. TO PREVENT THE EXPORT OF THE GOODS WHICH ARE ESSENTIAL FOR THE DEVELOPMENT AND OR MAINTENANCE OF THE COUNTRY’S ECONOMY.2. TO ENSURE THAT THE FULL VALUE OF THE EXPORTED GOODS IS RECEIVED IN INDIA WITHIN THE TIME LIMIT AND IN A PERMITTED METHOD OF PAYMENT.
  • 20. Chapter No. 3 Page No. 56 International FinanceIMPORT / EXPORT CONTROL EXPORT TRADE NOTICES THE OFFICE OF THE DIRECTOR GENERAL OF FOREIGN TRADE ISSUES EXPORT NOTICES: PROHIBITING THE EXPORT OF CERTAIN COMMODITIES. MAKING THE EXPORT OF CERTAIN COMMODITIES SUBJECT TO LICENCE FROM THE EXPORT TRADE CONTROL. PRESCRIBING THE MINIMUM EXPORT PRICES FOR SOME COMMODITIES AND / OR THE METHODS BY WHICH PAYMENT FOR THE EXPORT OF SOME COMMODITIES SHOULD BE RECEIVED. REGULATING THE EXPORT.
  • 21. Chapter No. 3 Page No. 56 International FinanceIMPORT / EXPORT CONTROL EXPORT OF GOLD, etc. GOLD / SECURITIES: THE EXPORT OF GOLD FROM INDIA TO ANY DESTINATION, OR TAKING OR SENDING OF SECURITIES TO ANY PLACE OUTSIDE INDIA, REQUIRES RESERVE BANK’S PERMISSION. CURRENCY NOTES / FOREIGN EXCHANGE: NO PERSON CAN, EXCEPT WITH THE SPECIAL PERMISSION OF THE RESERVE BANK TAKE OR SEND OUT OF INDIA ANY INDIAN CURRENCY OR FOREIGN EXCHANGE OTHER THAN THE FOREIGN EXCHANGE OBTAINED BY HIM FROM AN AUTHORIZED AGENT. THE RESERVE BANK PERMITS ANY PERSON RESIDENT IN INDIA TO TAKE OR SEND OUT OF INDIA TO ANY COUNTRY OTHER THAN NEPAL , CURRENCY NOTES UP TO RS. 5000 PER PERSON AT ANY TIME. CONT….
  • 22. Chapter No. 3 Page No. 57 International FinanceIMPORT / EXPORT CONTROL EXPORT OF GOLD, etc. UNITS OF UTI: THE UNIT TRUST OF INDIA HAS BEEN GRANTED GENERAL PERMISSION BY THE RESERVE BANK TO EXPORT CERTIFICATES COVERING UNITS PURCHASED BY NON-RESIDENT INVESTORS OUT OF FOREIGN EXCHANGE REMITTANCES. COMPUTER SOFTWARE: COMPUTER SOFTWARE MAY BE EXPORTED EITHER IN PHYSICAL FORM OR NON-PHYSICAL FORM.
  • 23. Chapter No. 3 Page No. 58 International FinanceIMPORT / EXPORT CONTROL PRESCRIBED PERIOD FOR REALIZATION FOR EXPORTS THE PERIOD PRESCRIBED FOR REALIZATION OF THE PROCEEDS OF EXPORTS TO ALL OTHER COUNTRIES IS SIX MONTHS FROM THE DATE OF SHIPMENT. THE RESERVE BANK MAY EXTEND THE SAID PERIOD OF THREE TO SIX MONTHS. EXPORTS MADE BY A UNIT SITUATED IN A SPECIAL ECONOMIC ZONE, THE EXPORT PROCEEDS SHALL BE REALIZED AND REPATRIATED WITHIN 12 MONTHS FROM THE DATE OF EXPORT. CONT….
  • 24. Chapter No. 3 Page No. 59 International FinanceIMPORT / EXPORT CONTROL PRESCRIBED PERIOD FOR REALIZATION FOR EXPORTS IN CASE, WHERE AN EXPORTER HAS NOT BEEN ABLE TO REALIZE PROCEEDS OF A SHIPMENT MADE WITHIN THE PRESCRIBED PERIOD AND EXPECTS TO REALIZE IF EXTENSION IS ALLOWED, NECESSARY APPLICATION IN FORM ETX SHOULD BE MADE TO RBI THROUGH HIS BANKERS. CONT….
  • 25. Chapter No. 3 Page No. 59 International FinanceIMPORT / EXPORT CONTROL PRESCRIBED PERIOD FOR REALIZATION FOR EXPORTS EXPORT PROCEEDS ARE EXPECTED TO BE REALIZED AS PER THE ORIGINAL CONTRACTED TERMS BUT IF THE EXPORT BILL IS NOT REALIZED WITHIN THE ORIGINAL CONTRACTED TERMS, IT WILL BE TERMED AS OVERDUE EXPORT BILL AND IS SUBJECTED TO CRYSTALLIZATION AS PER FEDAI REGULATIONS. THE PERIOD OF REALIZATION FOR EXPORTS UNDER DEFERRED PAYMENTS ARRANGEMENT MAY BE EXTENDED BY THE RESERVE BANK TO - 2 YEARS IN CASE OF CONSUMER DURABLES, 11 YEARS IN CASE OF CAPITAL AND PRODUCER GOODS AND12 YEARS IN CASE OF TURNKEY PROJECTS.
  • 26. Chapter No. 3 Page No. 60 International FinanceIMPORT / EXPORT CONTROL EXEMPTED CATEGORIES DECLARATION ON A PRESCRIBED FORM REGARDING THE REALIZATION OF THE VALUE OF EXPORTS IS NOT NECESSARY. TRADE SAMPLES OF GOODS AND PUBLICITY. PERSONAL EFFECTS OF TRAVELERS. SHIP’S STORES TRANSSHIPMENT CARGO AND GOODS UNDER CENTRAL GOVT.ORDER FOR DEFENCE REQUIREMENTS. GOODS EXPORTED UNDER ORDER OF MILITARY, NAVAL AND AIR FORCE. CONT….
  • 27. Chapter No. 3 Page No. 60 International FinanceIMPORT / EXPORT CONTROL EXEMPTED CATEGORIES GOODS OR SOFTWARE ACCOMPANIED BY A DECLARATION THAT THE VALUE DOES NOT EXCEED RS. 25,000. GOODS IMPORTED FREE OF COST ON RE-EXPORT BASIS. AIRCRAFT OR AIRCRAFT ENGINES AND SPARE PARTS FOR OVERHAULING AND /OR REPAIRS WITHIN A PERIOD OF 6 MONTHS FROM THE DATE OF THEIR EXPORT. GOODS NOT EXCEEDING US $ 1000 OR ITS EQUIVALENT IN VALUE PER TRANSACTION EXPORTED TO MYANMAR UNDER BARTER TRADE AGREEMENT BETWEEN THE CENTRAL GOVT. AND THE GOVT. OF MYANMAR. CONT….
  • 28. Chapter No. 3 Page No. 60 International FinanceIMPORT / EXPORT CONTROL EXEMPTED CATEGORIES FOLLOWING GOODS WHICH ARE PERMITTED TO BE RE-EXPORTED: IMPORTED GOODS FOUND TO BE DEFECTIVE. GOODS IMPORTED FROM FOREIGN SUPPLIERS / COLLABORATION ON LOAN BASIS. GOODS IMPORTED FOUND SURPLUS AFTER PRODUCTION OPERATIONS. REPLACEMENT GOODS EXPORTED FREE OF CHARGE IN ACCORDANCE WITH THE PROVISION OF EXIM POLICY. GOODS SENT FOR TESTING OUTSIDE INDIA. DEFECTIVE GOODS SENT FOR REPAIRS OUTSIDE INDIA. EXPORTS PERMITTED BY THE RESERVE BANK .
  • 29. Chapter No. 3 Page No. 64 International FinanceIMPORT / EXPORT CONTROL EXCHANGE CONTROL REGULATIONS VIS-À-VIS NEPAL AND BHUTANa) FOR TRANSACTIONS IN INDIAN RUPEES THE UNDER NOTED PERSONS, FIRMS, COMPANIES RESIDENTS IN NEPAL OR BHUTAN ARE TREATED AS RESIDENTS IN INDIA.b) RUPEE ACCOUNTS THE AUTHORIZED DEALER IN INDIA OF PERSONS, FIRMS COMPANIES etc ARE REGARDED AS RESIDENTS ACCOUNTS.c) EXPORT OF GOODS FROM INDIA TO NEPAL OR BHUTAN IS NOT SUBJECT TO DECLARATION IN GR / PP FORM. CONT…
  • 30. Chapter No. 3 Page No. 65 International FinanceIMPORT / EXPORT CONTROL EXCHANGE CONTROL REGULATIONS VIS-À-VIS NEPAL AND BHUTANd) RUPEE TRANSFERS FROM ACCOUNTS IN INDIA OF INDIAN, NEPALESE OR BHUTANESE RESIDENTS IN NEPAL OR BHUTAN AS WELL AS INDIAN, NEPALESE OR BHUTANESE FIRMS, COMPANIES FUNCTIONING IN THESE COUNTRIES AGAINST EXPORTS TO THESE COUNTRIES FROM INDIA CAN BE MADE FREELY.e) PAYMENTS BETWEEN NEPAL AND INDIA ARE NOT ELIGIBLE FOR SETTLEMENT THROUGH ASIAN CLEARING UNION.f) PAYMENTS FROM INDIA TO SUPPLIERS IN THIRD COUNTRIES AGAINST IMPORTS INTO NEPAL OR BHUTAN ARE NOT PERMITTED. CONT….
  • 31. Chapter No. 3 Page No. 66 International FinanceIMPORT / EXPORT CONTROL EXCHANGE CONTROL REGULATIONS VIS-À-VIS NEPAL AND BHUTANg) FREIGHT ON EXPORTS FROM NEPAL OR BHUTAN TO FOREIGN COUNTRIES THROUGH AN INDIAN PORT MAY BE FREELY RECEIVED IN INDIAN RUPEES WHERE SHIPMENT IS MADE BY AN INDIAN, NEPALESE OR BHUTANESE CARRIER, AND FREIGHT ON IMPORTS FROM COUNTRIES OUTSIDE INDIA IF PAYABLE AT DESTINATION AT AN INDIAN PORT.h) PAYMENTS OF CLAIMS AGAINST INSURANCE POLICIES, MARINE OR NON-MARINE MAY BE MADE IN INDIAN RUPEES TO INDIANS, NEPALESE, BHUTANESE RESIDENTS IN NEPAL OR BHUTAN. PAYMENT IN FOREIGN CURRENCY TOWARDS CLAIMS UNDER INSURANCE POLICIES IS NOT PERMISSIBLE WITHOUT APPROVAL OF THE RESERVE BANK. CONT….
  • 32. Chapter No. 3 Page No. 66 International FinanceIMPORT / EXPORT CONTROL EXCHANGE CONTROL REGULATIONS VIS-À-VIS NEPAL AND BHUTANi) NEPALESE NATIONALS RESIDENTS BUT NOT PERMANENTLY RESIDENT IN INDIA ARE NOT ELIGIBLE FOR THE BENEFIT OF BASIC TRAVEL QUOTA.j) EXCHANGE CONTROL IN NEPAL DOES NOT PERMIT TRANSIT PASSENGERS AND FOREIGN TOURISTS TO TAKE INTO NEPAL RUPEE INSTRUMENTS ISSUED TO SUCH PERSONS SHOULD BE ENDORSED ‘NOT VALID FOR NEGOTIATION IN NEPAL’.k) ANY PERSON CAN BRING WITH HIM FROM NEPAL CURRENCY NOTES OF THE GOVT. OF INDIA OF DENOMINATION NOT ABOVE RS. 100. CONT….
  • 33. Chapter No. 3 Page No. 66 International FinanceIMPORT / EXPORT CONTROL EXCHANGE CONTROL REGULATIONS VIS-À-VIS NEPAL AND BHUTANl) OBLIGATION TO SURRENDER FOREIGN CURRENCY ON ARRIVING IN INDIA TO AN AUTHORIZED AGENT IS NOT APPLICABLE TO CURRENCIES OF NEPAL AND BHUTAN.m) SETTING UP OF JOINT VENTURES IN NEPAL BY RESIDENTS IN INDIA REQUIRES APPROVAL OF THE RESERVE BANK INCASE ANY REMITTANCE OF FOREIGN EXCHANGE OR EXPORT OF GOODS ARE INVOLVED.n) ISSUE AND TRANSFER OF INDIAN RUPEE SHARES AND SECURITIES TO RESIDENTS OF FIRMS IN NEPAL REQUIRES PERMISSION FROM RESERVE BANK. CONT….
  • 34. Chapter No. 3 Page No. 67 International FinanceIMPORT / EXPORT CONTROL EXCHANGE CONTROL REGULATIONS VIS-À-VIS NEPAL AND BHUTANo) INDIAN NATIONALS RESIDENT IN INDIA AND FIRM/ COMPANIES REGISTERED / INCORPORATED IN INDIA ARE REQUIRED TO OBTAIN PERMISSION OF THE RESERVE BANK TO ACQUIRE, HOLD, TRANSFER OR DISPOSE BY SALE, MORTGAGE, LEASE FOR A PERIOD EXCEEDING 5 YEARS, GIFT, SETTLEMENT OR OTHERWISE, ANY IMMOVABLE PROPERTY SITUATED IN NEPAL OR VICE VERSA EVEN THOUGH THE TRANSACTION IS SETTLED IN INDIAN RUPEES.
  • 35. Chapter No. 3 Page No. 67 International FinanceIMPORT / EXPORT CONTROL THE 2002-2007 EXIM POLICY THE LIBERALIZED EXPORT-IMPORT (EXIM) POLICY THOUGH IT SUPERSEDES THE PREVIOUS 1992-97 POLICY, IS VIRTUALLY AN EXTENSION OF THE SAME. THE PREVIOUS POLICY FOCUSED ON LIBERALIZATION, OPENNESS, TRANSPARENCY AND GLOBALIZATION AND PROVIDED INCENTIVES FOR GROWTH OF EXPORTS AND SIMPLIFIED PROCEDURES. THE MOST IMPORTANT FEATURES OF THE POLICY IS THAT AS MANY AS 542 ITEMS (18% OF TOTAL) HAVE BEEN REMOVED FROM RESTRICTED LIST OF WHICH 392 HAVE BEEN PLACED ON THE FREE LIST AND OTHER 150 ITEMS ON SPECIAL IMPORT LICENCE (SIL) LIST AND 60 ITEM HAVE BEEN TRANSFERRED FROM SIL TO FREE LIST.
  • 36. Chapter No. 3 Page No. 68 International FinanceIMPORT / EXPORT CONTROL THE 2002-2007 EXIM POLICY (NOTE WORTHY IMPROVEMENTS) THE DUTY PAYABLE ON IMPORT OF CAPITAL GOODS UNDER THE EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME HAS BEEN REDUCED FROM 15% TO 10%. THE BENEFIT OF THE EPCG SCHEME HAS BEEN EXTENDED TO SERVICES INDUSTRIES. THE THRESHOLD LEVEL UNDER THE ZERO –DUTY IMPORT SCHEME HAS BEEN REDUCED FROM RS. 20 CRORES TO RS. 5 CRORES FOR AGRICULTURE AND ALLIED SECTORS. PROVISION HAS BEEN MADE FOR GIVING DOUBLE WEIGHTAGE TO AGRO EXPORTS.
  • 37. Chapter No. 3 Page No. 69 International FinanceIMPORT / EXPORT CONTROL THE 2002-2007 EXIM POLICY (NOTE WORTHY IMPROVEMENTS) DOMESTIC SALES FOR EOUs AND EPZs IN AGRICULTURE AND ALLIED SECTORS HAVE BEEN LIBERALIZED SO THAT THE UNITS CAN SELL 50% OF THE PRODUCTION. AGENCIES FOR STOCKING GOLD TO FACILITATE EXPORTS HAS BEEN INCREASED. THE SOFTWARE SECTOR HAS BEEN GIVEN A BOOST. THE INITIAL VALIDITY PERIOD OF DUTY-FREE LICENCE AND EXPORT OBLIGATION IS BEING EXTENDED FROM 12 MONTHS TO 18 MONTHS WITH PROVISION FOR A FURTHER EXTENSION OF THE EXPORT OBLIGATION PERIOD BY 6 MONTHS.
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