Objectives & Agenda : The Regulations under FEMA regulate the Export transactions of Goods, Services and Currencies. In this Webinar we shall understand the Definition of the term 'Export', 'Services' and 'Currencies'. We will also look at various procedures and compliances involved while Exporting goods or services or currencies.

1. Export of Goods, Services &
Currencies: FEMA Perspective
CA. Divakar Vijayasarathy

2. Credits and Acknowledgments
Bharathi Priya R D
CA. Jugal Gala

3. Legends used in the Presentation
ACU Asian Clearing Union
AD Authorised Dealer
AMU Asian Monetary Unit
BTPs Bio-Technology Parks
CDF Currency Declaration Form
DDA Diamond Dollar Account
DGFT Director General of Foreign Trade
EC Exchange Control
EDI Electronic Data Interchange
EDF Export Declaration Form
EDPMS Export Data Processing and Monitoring System
EEFC Exchange Earners’ Foreign Currency
EHTPs Electronic Hardware Technology Parks
EPZ Export Processing Zone
EOUs Export Oriented Units
EXIM Export Import
FATF Financial Action Task Force
FC Foreign Currency
FE Foreign Exchange
FEMA Foreign Exchange Management Act, 1999
FIRC Foreign Inward Remittance Certificate
GOI Government of India
HAWB House Airway Bills
IATA International Air Transport Association
IRDA Insurance Regulatory and Development Authority
KYC Know Your Customer
OPGSPs Online Payment Gateway Service Providers
RBI Reserve Bank of India
SEZs Special Economic Zones
SOFTEX Software Exports
STPs Software Technology Parks
STPI Software Technology Parks of India
USD United States Dollars
USSR Union of Soviet Socialist Republics
XOS Export Outstanding Statement

4. Presentation Schema
Export of Goods
and Serices
Introduction
Realization and
Repatriation of
Proceeds of Export
of Goods / Software
/ Services
Manner of Receipt
and Payment
OPGSP’s
Settlement System
under ACU
Mechanism
Third Party
Payments for
Export and Import
Transactions
Settlement of
Export Transactions
in Currencies not
having a Direct
Exchange rate
Foreign Currency
Account, DDA, EEFC
Account
Counter-Trade
Agreement
Export of Currency
Obligations of AD
Bank
Remittances
Connected with
Export
Statistics

5. Export of Goods and Services – Sec 7 of FEMA, 1999
Every exporter of goods shall
• Furnish to RBI or to such other authority a declaration containing true and correct material particulars, including the
amount representing the full export value or, if the full export value of the goods is not ascertainable, the value which
the exporter, expects to receive on the sale of the goods in a market outside India
• Furnish to RBI such other information as may be required by the RBI for the purpose of ensuring the realisation of the
export proceeds by such exporter
RBI may, to ensure the export proceeds is received without any delay, direct any exporter to comply with such requirements
as it deems fit
Every exporter of services shall furnish to RBI or to such other authorities a declaration containing the true and correct
material particulars in relation to rendering of services
Export – Sec 2(l) of FEMA
Taking out of India to a place outside India any goods or
Provision of services from India to any person outside India
Service – Sec 2(zb)
of FEMA
Service of any description which is made available to potential users and includes the provision of facilities
in connection with banking, financing, insurance, medical assistance, legal assistance, chit fund, real estate,
transport, processing, supply of electrical or other energy, boarding or lodging or both, entertainment,
amusement or the purveying of news or other information, but does not include the rendering of any
service free of charge or under a contract of personal service

6. General Rules and Regulations for Export of Goods
and Services

7. Introduction
There is no restriction on invoicing of export contracts in Indian Rupees as per FEMA
As per Foreign Trade Policy (2015-2020)
All export contracts and invoices shall be denominated either in freely convertible currency or Indian rupees
Export proceeds shall be realized in freely convertible currency
However, export proceeds against specific exports may also be realized in rupees, provided it is through a freely convertible
Vostro account of a non-resident bank situated in any country other than a member country of Asian Clearing Union (ACU)
or Nepal or Bhutan
Indian Rupee is not a freely convertible currency
A Vostro account refers to an account
that a domestic bank holds in a domestic
bank’s currency for another foreign bank

8. Realization and Repatriation of Proceeds of Export of
Goods / Software / Services
It is obligatory on the part of the exporter to realize and repatriate the full value of
goods / software / services to India within a stipulated period from the date of export
Time period for
Realization and
Repatriation
For all exporters including units in SEZs, Status Holder
Exporters, EOUs, EHTPs, STPs and BTPs
9 months from the date of export
15 months from the date of
shipment of goods
For goods exported to a warehouse established outside India

9. Manner of Receipt and Payment
The amount representing the full export value of the goods exported shall be received through an AD Bank in a prescribed
manner under FEMA
When payment for goods sold to overseas
buyers during their visits is received
Export Declaration Form (EDF) duplicate should be released by the AD
Category – I banks only on receipt of funds in their Nostro account or
If the AD Category – I bank concerned is not the Credit Card servicing
bank, on production of a certificate by the exporter from the Credit
Card servicing bank in India to the effect that it has received the
equivalent amount in foreign exchange or
AD Category – I banks may also receive payment for exports made out
of India by debit to the credit card of an importer where the
reimbursement from the card issuing bank/ organization will be
received in FE
A Nostro account refers
to an account that a bank
of a country holds in a
foreign currency in bank
of another country

10. Processing of Export Receipts through OPGSPs
AD Category-I banks have been allowed to offer the facility of repatriation of export related remittances by entering
into standing arrangements with OPGSPs subject to the following conditions
The AD Category-I banks offering this facility shall carry out the due diligence of the OPGSP
OPGSP shall only be available for export of goods and services of value not exceeding USD 10,000
AD Category-I shall open a NOSTRO collection account for receipt of the export payments facilitated through such
arrangements
Where notional accounts are opened with OPGSP, it shall be ensured that no funds are allowed to be retained in such
accounts and all receipts should be automatically swept and pooled into the NOSTRO collection account
A separate NOSTRO collection account may be maintained for each OPGSP or the bank should be able to delineate the
transactions in the NOSTRO account of each OPGSP
The permissible debits to the NOSTRO collection account are for repatriation of funds representing export proceeds to India for
credit to the exporters’ account, payment of fee/commission to the OPGSP as per the predetermined rates / frequency/
arrangement and charge back to the importer where the exporter has failed in discharging his obligations under the sale
contract

11. Contd.
The balances held in the NOSTRO collection account shall be repatriated and credited to the respective exporter's
account with a bank in India, immediately on receipt of the confirmation from the importer, within 7 days from the
date of credit to the NOSTRO collection account
AD Category -I banks shall satisfy themselves as to the bona-fides of the transactions and ensure that the
purpose codes reported to the RBI are appropriate
AD Category -I banks shall submit all the relevant information relating to any transaction under this
arrangement to the RBI, as and when required
Each NOSTRO collection account should be subject to reconciliation and audit on a quarterly basis
Resolution of all payment related complaints of exporters in India shall remain the responsibility of the
OPGSP concerned
AD Category-I banks desirous of entering into such an arrangement/s should report the details of each such
arrangement, as and when entered, to the FE Department
A start-up can realise the receivables of its overseas subsidiary and repatriate them through OPGSPs

12. Settlement System Under ACU Mechanism
In order to facilitate transactions or settlements, participants in the Asian Clearing Union (ACU) will have the option to settle their
transactions either in ACU Dollar or in ACU Euro
The Asian Monetary Unit (AMU) shall be denominated as ‘ACU Dollar’ and ‘ACU Euro’ which shall be equivalent in value to one
USD and one Euro respectively
AD Category-I banks are allowed to open and maintain ACU Dollar and ACU Euro accounts with their correspondent banks in other
participating countries
Relaxation from ACU Mechanism- Indo-Myanmar Trade - Trade transactions with Myanmar can be settled in any freely convertible
currency in addition to the ACU mechanism
In view of the difficulties being experienced by importers or exporters in payments to or receipts from Iran, it has been decided
that all eligible current account transactions including trade transactions with Iran should be settled in any permitted currency
outside the ACU mechanism
It has been decided to permit the use of the Nostro accounts of the commercial banks of the ACU member countries for settling the
payments of both exports and imports of goods and services among the ACU countries
ACU Participants
• Bangladesh Bank
• Royal Monetary Authority of Bhutan
• Reserve Bank of India (RBI)
• Central Bank of the Islamic Republic of Iran
• Maldives Monetary Authority
• Central Bank of Myanmar
• Nepal Rastra Bank
• State Bank of Pakistan
• Central Bank of Sri Lanka

13. Third Party Payments for Export or Import Transactions
Considering the evolution of international trade practices, 3rd party payments for export or import transactions are permitted
subject to the following conditions
Firm irrevocable order backed by a tripartite agreement should be in place
• AD bank should be satisfied with the bona-fides of the
transaction and export documents, such as, invoice or FIRC
• AD bank should consider the FATF statements while handling
such transaction
It may not be insisted upon in cases where
documentary evidence for circumstances leading to
3rd party payments or name of the 3rd party being
mentioned in the irrevocable order or invoice has
been produced subject to:
3rd party payment should be routed through the banking channel only
The exporter should declare the 3rd party remittance in the EDF and it would be responsibility of the Exporter to realize and
repatriate the export proceeds from such 3rd party named in the EDF
Reporting of outstanding, if any, in the Export Outstanding Statement (XOS) would continue to be shown against the name of
the exporter and the name of the 3rd party should appear in the XOS instead of overseas buyer
In case of shipments being made to a country in Group II of Restricted Cover Countries, (Armenia, Kyrgyz Sfan, Tajikistan,
Turkmenistan, Uzbekistan, Sudhan, Somalia), payments may be received from an Open Cover Country (Azerbaijan, Belarus,
Georgia , Kazakhstan, Moldova, Russia, Ukraine)
In case of imports, the Invoice should contain a narration that the related payment has to be made to the named 3rd party,
the Bill of Entry should mention the name of the shipper as also the narration that the related payment has to be made to the
named 3rd party and the importer should comply with the related extant instructions relating to imports including advance
payments
Restricted cover Group II country is country which experiences chronic political and economic
problems as well as balance of payment difficulties

14. Settlement of Export Transactions in Currencies not
having a Direct Exchange rate
In case of exports where the settlement takes place in the currency of the beneficiary which does not
have a direct exchange rate, it has been decided that AD Category-I banks may permit settlement of such
export transactions (excluding those put through the ACU mechanism),
subject to the following conditions
Exporter shall be a customer of the AD Bank,
Signed contract or invoice is in a freely convertible currency
The beneficiary is willing to receive the payment in the currency of beneficiary instead
of the freely convertible currency of the invoice or contract, Letter of Credit as full and
final settlement
AD bank is satisfied with the bonafides of the transactions
The counterparty to the exporter or importer of the AD bank is not from a country or
jurisdiction in the updated FATF Public Statement on High Risk & Non Co-operative
Jurisdictions on which FATF has called for counter measures (Iran & North Korea)

15. Foreign Currency Account
Participants in international exhibition or trade fair have been granted general permission for opening a temporary foreign
currency account abroad
Exporters may deposit the foreign exchange obtained by sale of goods at the international exhibition or trade fair and
operate the account during their stay outside India provided that the balance in the account is repatriated to India through
normal banking channels within a period of 1 month from the date of closure of the exhibition or trade fair and full details
are submitted to the AD Category – I banks
Reserve Bank may consider applications in Form EFC from exporters having good track record for opening a foreign currency
account with AD banks in India and outside India subject to certain terms and conditions
Applications for opening the account with a branch of an AD Category-I bank in India may be submitted through the branch
at which the account is to be maintained. If the account is to be maintained abroad the application should be made by the
exporter giving details of the bank with which the account will be maintained
An Indian entity can also open, hold and maintain a foreign currency account with a bank outside India, in the name of its
overseas office or branch, by making remittance for the purpose of normal business operations of the said office or branch
or representative subject to specified conditions
A unit located in a SEZ may open, hold and maintain a Foreign Currency Account with an AD Category-I bank in India subject
to prescribed conditions
A person resident in India being a project or service exporter may open, hold and maintain foreign currency account with a
bank outside or in India, subject to the standard terms and conditions in the Projects and Service Exports Memorandum

16. Diamond Dollar Account (DDA)
Under the scheme of GOI, firms and companies dealing in purchase or sale of rough or cut and polished
diamonds or precious metal jewellery plain, minakari and or studded with or without diamond and or other
stones, with a track record of at least 2 years in import or export of diamonds or colored gemstones or diamond
and colored gemstones studded jewellery or plain gold jewellery and having an average annual turnover of Rs. 3
crores or above during the preceding 3 licensing years are permitted to transact their business through DDA
They may be allowed to open not more than 5 DDA with their banks
Eligible firms and companies may apply for permission to their AD Category-I banks in the format prescribed
Conditions mentioned in EEFC account for conversion in rupees and restriction on foreign assets (explained
subsequently) shall also apply

17. Exchange Earners’ Foreign Currency (EEFC) Account
A person resident in India may open with, an AD Category-I bank in India, an account in foreign currency called the EEFC
Account subject to prescribed conditions
Resident individuals are permitted to include resident close relatives as defined in the Companies Act, 2013 as a joint
holders in their EEFC bank accounts on former or survivor basis
This account shall be maintained only in the form of non-interest bearing current account - No credit facilities shall be
permitted against the security of balances held in EEFC accounts by the AD Category-I banks
• The sum total of the accruals in the account during a calendar month
should be converted into Rupees on or before the last day of the
succeeding calendar month after adjusting for utilization of the
balances for approved purposes or forward commitments
• The facility of EEFC scheme is intended to enable exchange earners to
save on conversion or transaction costs while undertaking forex
transactions. This facility is not intended to enable exchange earners to
maintain assets in foreign currency, as India is still not fully convertible
on Capital Account
All categories of foreign exchange earners
are allowed to credit 100% of their foreign
exchange earnings to their EEFC Accounts
subject to the condition that
Relative – Sec 2(77) of Companies Act, 2013 read with Rule 4 - Father, mother, son, daughter, son’s wife, daughter’s
husband, brother, sister, step-father, step-mother, step-son, step-brother and step-sister

18. Contd.
• Inward remittance received through normal banking channel, other than the remittance
received pursuant to any undertaking given to the RBI or which represents foreign currency
loan raised or investment received from outside India or those received for meeting specific
obligations by the account holder
• Payments received in FE by a 100% EOU or a unit in EPZ, STP or EHTP for supply of goods to
such similar unit or to a unit in Domestic Tariff Area and also payments received in FE by a unit
in Domestic Tariff Area for supply of goods to a unit in SEZ
The eligible credits
represent
AD Category-I banks may permit their exporter constituents to extend trade related loans or advances to overseas
importers out of their EEFC balances without any ceiling subject to prescribed compliances
AD Category-I banks may permit exporters to repay packing credit advances whether availed in Rupee or in FC from
balances in their EEFC account and or Rupee resources to the extent exports have actually taken place
Where a part of the export proceeds are credited to an EEFC account, the EDF (duplicate) may be certified as: “Proceeds
amounting to …… representing ….. % of the export realization credited to the EEFC account maintained by the exporter
with……”

19. Counter-Trade Arrangement
All imports and exports under the arrangement should be at international prices in conformity with the Foreign
Trade Policy and FEMA (including rules and regulations)
No interest will be payable on balances standing to the credit of the Escrow Account but the funds temporarily
rendered surplus may be held in a short-term deposit up to a total period of 3 months in a year and the banks may
pay interest at the applicable rate
No fund based or non-fund based credit facilities would be permitted against the balances in the Escrow Account
Application for permission for opening an Escrow Account may be made by the overseas exporter or organization
through his or their AD Category-I bank to the Regional Office concerned of the RBI
Counter trade proposals involving adjustment of value of goods imported into India against value of goods exported from
India in terms of an arrangement voluntarily entered into between the Indian party and the overseas party through an
Escrow Account (separate account to hold money of others) opened in India in US Dollar will be considered by the RBI
subject to the following conditions

20. Exports to Neighboring Countries By Road, Rail or River
The following procedure should be adopted by exporters for filing original copies of EDF where exports are made to
neighboring countries (Pakistan, China, Bangladesh, Nepal, SriLanka, Bhutan, Myanmar) by road, rail or river transport
• In case of exports by barges or country craft or road transport, the form should be presented by exporter or his agent
at the Customs station at the border through which the vessel or vehicle has to pass before crossing over to the foreign
territory.
• As regards exports by rail, Customs staff has been posted at certain designated railway stations for attending to
Customs formalities. They will collect the EDF for goods loaded at these stations so that the goods may move straight
on to the foreign country without further formalities at the border. For goods loaded at stations other than the
designated stations, exporters must arrange to present EDF to the Customs Officer at the Border Land Customs
Station where Customs formalities are completed
• Barter trade system has been discontinued with effect from 01.12.2015
• Thus, all trade transactions with Myanmar shall be settled in permitted currency in addition to ACU mechanism
Border Trade with
Myanmar
• RBI will consider counter trade proposals from Indian exporters with Romania involving adjustment of value of
exports from India against value of imports made into India in terms of a voluntarily entered arrangement
between the concerned parties, subject to the condition, among others that the Indian exporter should utilize
the funds for import of goods from Romania into India within 6 months from the date of credit to Escrow
Accounts allowed to be opened
Counter-Trade
arrangements with
Romania
• Export of goods and services against repayment of state credits granted by erstwhile USSR will continue to be
governed by the extant directions issued by the RBI
Repayment of State
Credits
• EXIM Bank and AD Category-I banks have been permitted to undertake forfaiting, for financing of export
receivables. Remittance of commitment fee or service charges, etc., payable by the exporter as approved, may
be done through an AD bank. Such remittances may be made in advance in one lump sum or at monthly
intervals as approved by the authority concerned
Forfaiting

21. Export Factoring on Non-Recourse Basis
AD banks may take their own business decision to enter into export factoring arrangement on non-recourse basis.
They should ensure that their client is not over financed. Accordingly, they may determine the working capital
requirement of their clients taking into account the value of the invoices purchased for factoring. The invoices
purchased should represent genuine trade invoices.
In case the export financing has not been done by the Export Factor, he may pass on the net value to the financing
bank or Institution after realising the export proceeds.
Export Factor should have an arrangement with the Import Factor for credit evaluation & collection of payment
Notation should be made on the invoice that importer has to make payment to the Import Factor
After factoring, the Export Factor may close the export bills and report the same in the EDPMS of RBI
In case of single factor, not involving Import Factor overseas, the Export Factor may obtain credit evaluation details
from the correspondent bank abroad
KYC and due diligence on the exporter shall be ensured by the Export Factor
AD banks have been permitted to factor the export receivables on a non-recourse basis (exporters assuming risk on non-
payment), so as to enable the exporters to improve their cash flow and meet their working capital requirements
subject to following conditions
Export factor is an institution which provides complete financial package that combines export working capital financing,
credit protection, foreign accounts receivable bookkeeping, and collection services
Import factor is an intermediary providing services of obtaining a short-term buyer's credit for goods the importer purchases from
foreign suppliers without the need of issuing any kind of banker's guarantee, letter of credit, bill of exchange, etc.

22. Project Exports and Service Exports
Export of engineering goods on deferred payment terms and execution of turnkey projects and civil construction contracts
abroad are collectively referred to as ‘Project Exports’
Indian exporters are required to obtain the approval of the AD Category-I banks or EXIM Bank at post-award stage before
undertaking execution of such contracts
Regulations relating to ‘Project Exports’ and ‘Service Exports’ are laid down in the revised Memorandum of Instructions on
Project and Service Exports (PEM-July 2014)
AD banks or EXIM Bank may consider awarding post-award approvals without any monetary limit and permit subsequent
changes in the terms of post award approval within the relevant FEMA guidelines or regulations
Project and service exporters may approach AD banks or EXIM Bank based on their commercial judgment - Respective AD
bank or EXIM Bank should monitor the projects for which post-award approval has been granted by them

23. Contd.
• The stipulation regarding recovery of market value of the machinery, etc., from the
transferee project has been withdrawn
• Exporters may use the machinery or equipment for performing any other contract secured
by them in any country subject to the satisfaction of the sponsoring AD Category – I bank(s) /
Exim Bank and also subject to the reporting requirement and would be monitored by the AD
Category – I bank(s) / Exim Bank
Inter-Project transfer
of machinery
• AD Category-I bank or EXIM Bank may permit exporters to open, maintain and operate one
or more FC account in a currency or currencies of their choice with inter-project
transferability of funds in any currency or country
Inter-Project transfer
of funds
• Subject to monitoring by the AD Category-I bank or EXIM Bank, Project or Service exporters
may deploy their temporary cash surpluses, generated outside India investments in short-
term paper abroad including treasury bills and other monetary instruments with a maturity
or remaining maturity of 1 year or less and
• The rating of which should be at least A-1 or AAA by Standard and Poor or P-1 or AAA by
Moody’s or F1 or AAA by Fitch IBCA etc., and as deposits with branches or subsidiaries
outside India of AD Category-I banks in India
Deployment of
temporary cash
surpluses
• The requirement of repatriation of 30% of contract value in respect of on-site contracts by
software exporter company or firm has been dispensed with
• However, repatriation of profits of on-site contracts after completion of the contracts is
required
Repatriation of funds
in case of On-site
Software Contracts
In order to provide greater flexibility to project and service exporters in conducting their overseas
transactions, facilities have been provided as under:

24. Export of Goods on Lease, Hire, etc.
Exporters should apply for necessary permission, through an AD Category-I banks, to the Regional Office concerned of the
RBI, giving full particulars of the goods to be exported
Prior approval of the RBI is required for export of machinery, equipment, etc., on lease, hire basis under agreement with
the overseas lessee against collection of lease rentals or hire charges and ultimate re-import
Export on Elongated Credit Terms
Exporters intending to export goods on elongated credit terms may submit their proposals giving full particulars through
their banks for consideration to the Regional Office concerned of the RBI

25. Export of Currency

26. Export of Currency
Any person resident in India may take outside India (other than to Nepal and Bhutan) currency notes of GOI and RBI
notes up to an amount not exceeding Rs.25,000 per person subject to such conditions as notified by RBI
Any person resident in India may take or send outside India (other than to Nepal and Bhutan) commemorative coins
not exceeding 2 coins each
Any person resident outside India, not being a citizen of Pakistan and Bangladesh and also not a traveler coming from
and going to Pakistan or Bangladesh, and visiting India may take outside India currency notes of GOI and RBI notes up
to an amount not exceeding Rs. 25,000 while exiting only through an airport
• Includes all currency notes, postal notes, postal orders, money orders, cheques, drafts,
travellers cheques, letters of credit, bills of exchange and promissory notes, credit cards or
such other similar instruments, as may be notified by the Reserve Bank
Currency – Sec 2(h) of
FEMA, 1999
• Includes cash in the form of coins and bank notes
Currency Notes – Sec 2(i) of
FEMA, 1999
• Includes coin issued by Government of India Mint to commemorate any specific occasion or
event and expressed in Indian currency
Commemorative Coins
Reserve Bank may, on application made to it and on being satisfied that it is necessary to do so, allow a person to take out of
India currency notes of GOI and RBI subject to such terms and conditions as the Bank may stipulate

27. Contd.
Prohibition on Export of
Indian Coins
No person shall take or send out of India the Indian coins which are covered by the
Antique and Art Treasure Act, 1972
Prohibition on Export of
Foreign Currency (FC)
No person shall, without the general or special permission of the RBI, export or send out
of India, any FC
Foreign currency means any currency other than Indian currency – Sec 2(m) of FEMA, 1999

28. Export of Foreign Exchange and Currency Notes
Any person resident outside India may take out of India unspent FE not exceeding the amount brought in by him and
declared in CDF on his arrival in India
Any person may take out of India
FE possessed by him in accordance with the regulations
prescribed under FEMA
Unspent FE brought back by him to India while returning
from travel abroad and retained in accordance with the
prescribed regulations
Any person may take or send out of India
Cheques drawn on FC account
maintained in accordance with
regulations prescribed under FEMA
FE obtained by him by drawal from an
authorised person
Currency in the safes of vessels or
aircrafts which has been brought into
India or which has been taken on board
a vessel or aircraft with the permission
of RBI
An authorised person may send out of India FC acquired in normal course of business

29. Export of Currency To or From Nepal and Bhutan
Any person may
Take or send out of India to Nepal or Bhutan, currency notes
of GOI and RBI notes (other than notes of denominations of
above Rs.100 in either case) provided that an individual
travelling from India to Nepal or Bhutan can carry RBI notes
of Mahatma Gandhi (new) Series of denominations Rs. 200
and or Rs. 500 up to a total limit of Rs. 25,000
Take out of India to Nepal or Bhutan, currency notes being the
currency of Nepal or Bhutan

30. Obligations of Authorised Dealers

31. Obligations of Authorised Dealer Bank
Grant of EDF Waiver
from exporters
Confirmation for
receipt of advance
against exports
EDF Approval for
Trade
Fair/Exhibitions
abroad
EDF approval for
export of goods for
re-imports
Re-export of unsold rough
diamonds from Special Notified
Zone of Customs without EDF
formality
Setting up of Offices abroad
and acquisition of
immovable property for
Overseas Office
Handling delays in
submission of shipping
documents by exporters
Return of documents to
exporters
Delivering copy of Bill
of Lading to the
Master carrying
vessel for exports to
landlocked countries
Direct dispatch of
documents by the
exporter
Negotiating invoices for
Part Drawings
/Undrawn Balances
Handling
Consignment Exports
Opening / hiring of
warehouses abroad
Maintenance of
Export Bills Register
In the following cases, AD shall be obligated to act as per the directions laid
down under the FEMA Regulation

32. Contd.
Follow-up of
overdue bills
Reduction in invoice
value on account of
prepayment of usance
bills
Reduction in
invoice value in
specified cases
Handling change of
buyer/consignee
Handling export of
goods by Special
Economic Zones (SEZs )
Extension of time
for realisation of
export proceeds
Facilitating for
insurance claims
for shipments
lost in transit
Remittance of
export claims
Write-off of
unrealized export
bills
Write off in cases of payment of claims by ECGC and
private insurance companies regulated by IRDA
Write-off of
realisation of
export proceeds
Set-off of export
receivables against
import payables
Netting-off of export
receivables against import
payments-Units in SEZs
Recommendatio
n for exporters in
Caution List
Issue of Guarantees
Issuance of Electronic
Bank Realisation
Certificate (eBRC)

33. Remittances Connected with Exports

34. Agency Commission on Exports
Amount of commission has been declared on EDF or SOFTEX form and accepted by the Customs authorities or Ministry of
Information Technology, GOI or EPZ authorities as the case may be
Where the commission has not been declared on EDF or SOFTEX form, remittance may be allowed after satisfying the
reasons adduced by the exporter for not declaring commission on EDF provided a valid agreement or written
understanding between the exporters and or beneficiary for payment of commission exists
The relative shipment has already been made
AD Category-I banks may allow payment of commission, either by remittance or by deduction from
invoice value, on application submitted by the exporter
The remittance on agency commission may be allowed subject to conditions as under

35. Contd.
Amount of commission has been declared on EDF or SOFTEX form and accepted by the Customs authorities or Ministry of
Information Technology, GOI or EPZ authorities as the case may be
Where the commission has not been declared on EDF or SOFTEX form, remittance may be allowed after satisfying the reasons
adduced by the exporter for not declaring commission on EDF provided a valid agreement or written understanding between the
exporters and or beneficiary for payment of commission exists
The relative shipment has already been made
The commission is not payable to Escrow Account holders themselves and commission should not be allowed by deduction from
the invoice value
AD Category-I banks may allow payment of commission by Indian exporters, in respect of their exports
covered under counter trade arrangement through Escrow Accounts designated in USD
Subject to following conditions
Payment of commission is prohibited on exports made by Indian Partners towards equity participation
in an overseas joint venture or wholly owned subsidiary as also exports under Rupee Credit Route
except commission up to 10% of invoice value of exports of tea & tobacco

36. Refund of Export Proceeds
AD Category-I banks, through whom the export proceeds were originally realized may consider requests for refund of
export proceeds of goods exported from India and being re-imported into India on account of poor quality
While permitting such transactions, AD Category-I banks are required to
• Exercise due diligence regarding the track record of the exporter
• Verify the bona-fides of the transactions
• Obtain from the exporter a certificate issued by DGFT or Custom authorities that no incentives have been availed by
the exporter against the relevant export or the proportionate incentives availed, if any, for the relevant export have
been surrendered
• Obtain an undertaking from the exporter that the goods will be re-imported within 3 months from the date of
remittance
• Ensure that all procedures as applicable to normal imports are adhered to

37. Statistics

38. India’s Receipts
337237
308970
280138 266365
316545306483
283406
242051 235044 241645
0
50000
100000
150000
200000
250000
300000
350000
400000
2018-19 2017-18 2016-17 2015-16 2014-15
in USD Million
Merchandise (Exports) Invisibles
Invisibles = Services (Exports) + Transfers (Official & Private) + Income (Investment Income, Compensation of employees)

39. Export of Principal Commodities
Tea Coffee Rice
Other
cereals
Tobacco Spices Cashew Oil Meals Oil seeds
Fruits &
Vegetables
2014-15 681.8 814.0 7853.1 869.1 958.6 2430.3 909.3 1324.2 1735.4 2153.5
2015-16 720.0 783.9 5846.6 261.2 982.0 2541.5 768.6 553.0 1246.9 2268.8
2016-17 731.3 842.8 5733.8 212.3 958.7 2851.9 786.9 805.4 1355.2 2454.7
2017-18 837.4 968.6 7806.2 248.6 934.3 3115.4 922.4 1093.2 1174.3 2513.3
2018-19 830.9 822.3 7752.7 349.1 981.2 3322.6 654.4 1511.5 1156.9 2538.1
0.0
1000.0
2000.0
3000.0
4000.0
5000.0
6000.0
7000.0
8000.0
9000.0
in USD Million

40. Trade Deficit with Developing Economies
-71000.0 -61000.0 -51000.0 -41000.0 -31000.0 -21000.0 -11000.0 -1000.0 9000.0
China
Bangladesh
South Korea
Maldives
Thailand
China Bangladesh South Korea Maldives Thailand
2014-15 -48477.5 5828.5 -8926.2 148.1 -2401.1
2015-16 -52696.6 5307.8 -9523.7 174.8 -2522.3
2016-17 -51111.1 6118.4 -8343.9 188.6 -2282.0
2017-18 -63047.2 7928.7 -11900.8 211.3 -3480.6
2018-19 -53570.0 8171.2 -12053.7 202.3 -3000.4
Trade Deficit with Developing Economies (in US$ Million)

41. Total Transactions Routed Cumulatively Through
the ACU in October 2019
(In millions of USDs)

42. Thank You
DVS Advisors LLP
India-Singapore-London-Dubai-Malaysia-Africa
www.dvsca.com
Copyrights © 2019 DVS Advisors LLP
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