• UGI USER
  • Jul 03, 2024
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RBI PROPOSES RATIONALISING EXIM NORMS

Why in the news?

  • The Reserve Bank of India (RBI) has suggested changes to regulations governing export and import transactions.
  • This move aims to enhance the ease of doing business and enable banks to better serve their foreign exchange customers.

Source: ResearchGate

Proposed Regulations

  • RBI issued the “Regulation of Foreign Trade under Foreign Exchange Management Act (FEMA), 1999 – Draft Regulations and Directions.”
  • These draft regulations require exporters to declare the full export value of goods or services to a specified authority.

What is EXIM?

EXIM (Export-Import) refers to the international trade of goods and services. It encompasses the export (selling abroad) and import (buying from abroad) activities that facilitate global commerce, driving economic growth and expanding market reach.

Foreign Exchange Management Act, 1999 (FEMA)

  • Legal Framework: Provides the legal structure for managing foreign exchange transactions in India.
  • Enforcement Date: Came into effect on 1st June 2000.
  • Transaction Classification: Divides all foreign exchange transactions into capital or current account transactions.