RBI to examine overseas investment rules
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Can a resident individual subscribe to an 'unregulated' fund in Singapore? Can a local startup buy into a fintech firm abroad? Is a high-net-worth (HNI) individual barred from holding fixed deposits in an offshore bank? Will an Indian company holding a minority stake, but having no 'control', in a foreign company have to walk the extra mile on compliance? For months many Indians, keen to diversify their assets and execute business strategies, have been looking for unequivocal answers to a slew of such questions.
Besides, clearing the fog on such matters would help individuals and companies avoid any violation of the Foreign Exchange Management Act (FEMA).
The central bank has asked leading authorised dealer banks, who handle the transfer of money for such offshore investments, to identify the issues. Officials of RBI's Overseas Investment Department are scheduled to meet bankers this week, two persons aware of the matter told ET. Bankers and practitioners believe it would mark a beginning in resolving some of the issues which have been hanging fire for over a year.
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