1.

Indian Direct Investment in Joint Ventures (JV)/Wholly Owned Subsidiaries Abroad (WOS)

Government of India, Ministry of Commerce vide its Notification No.4/ 1/93-EP(OI) dated May 3, 1999 have further liberalised the Guidelines for Indian Direct Investment in Joint Ventures (JV)/Wholly Owned Subsidiaries (WOS) abroad under the Fast Track Route of Reserve Bank. Accordingly, the existing ceiling of Rs.60 crores on Indian rupee investment in Nepal and Bhutan in respect of which applications are considered by the Reserve bank has been raised to Rs.120 crores. Further, the Reserve Bank would now consider applications for investment in SAARC countries and Myanmar upto US $ 30 mn. as against the existing ceiling of U.S. $ 15 mn. The current ceiling of U.S. $ 15 mn. will continue to remain applicable for investment in other countries. Other terms and conditions for approval under the Fast Track Route remain unchanged.

2.

Advance Remittance for Imports

As per extant regulations, in cases where advance remittance has been made against import of goods, physical import of goods into India should be made within three months (twelve months in the case of capital goods) from the date of remittance. Authorised dealers have now been permitted to allow extension of time in such cases for import of goods not exceeding one month (three months in the case of capital imports) provided, the reasons for seeking extension of time are convincing. In cases where the advance remittance has been made against a bank guarantee, the guarantee should be suitably amended, if need be, to cover the extended period for import of goods into India.

3.

EEFC Accounts

It has been decided to permit authorised dealers to remit royalty on reproduction of copyright music recorded by overseas companies, even if the rate of royalty exceeds 20 per cent provided the payment is made from the applicant’s EEFC account. If, however, the rate of royalty payable exceeds 20 per cent and the payment is not being made out of funds held in EEFC account, the applicant should obtain specific approval from the Department of Electronics, Government of India, New Delhi.