Forex remittance limit raised to $100,000

MUMBAI: Emboldened by the surge in dollar inflows and a strengthening rupee, the Reserve Bank of India has raised the foreign currency limit on remittances for education, employment abroad, emigration, and maintenance of overseas relatives to $100,000.
This represents a 20-fold increase in the limit for employment, emigration and maintenance of relatives. In the case of education, it represents more than three times the current ceiling.
Significantly, RBI has also doubled the remittance limit for medical expenses to $100,000 without insisting on an estimate by a medical practitioner. Further, corporates will be allowed to remit up to $1m towards consultancy services procured abroad against the present limit of $100,000.
In a circular issued here on Thursday, RBI said that authorised dealers may allow remittances for amounts up to the above-mentioned limits for each category, without insisting on any supporting documents, but on the basis of a self-declaration incorporating the basic details of the transaction and submission of application in the prescribed format.
“Understandably, this is triggered by large forex inflows and a robust reserves position. However, this is unlikely to create a significant demand in dollar...the move is part of RBI’s policy to liberalise current account transactions, and should not be construed as a move towards capital account convertibility,� said a senior banker.
Earlier, authorised dealers were allowed to release only $5,000 to individuals for meeting expenses towards overseas employment, overseas education, emigration, and maintenance of close relatives. The limit for these categories has now been fixed at $100,000.
In September ’02, RBI eased exchange control regulations — it allowed forex up to $50,000, or its equivalent, to be released for medical treatment abroad, without insisting on any estimate from a hospital/doctor.
“It has since been decided that authorised dealers may henceforth release foreign exchange up to $100,000 or its equivalent, to resident Indians for medical treatment abroad, without insisting on any estimate from a hospital/doctor in India/abroad,� RBI said.
Until recently, most of the major relaxations in current account transactions dealt with overseas travel. In November, RBI allowed Indian travellers going abroad to make hotel reservations and buy Euro Rail tickets beyond their basic travel quota, which was earlier doubled to $10,000.