Reserve Bank of India proposes new draft export and import rules

This Reserve Bank of India (RBI) introduced new draft regulations relating to the export and import transaction process under the Foreign Exchange Management Act (FEMA), 1999. These proposals were presented in “The Foreign Exchange Management (Export and Import of Goods and Services) Ordinance, 2024”

Every exporter is obliged to submit to the designated authority, within a specified period, a declaration specifying the full export value of the goods or services.

Exporters must submit all relevant export documents to the Authorised Dealer (AD) within 21 calendar days from the date of shipment of goods or the date of invoice for services.

The regulations stipulate that the full value of exports must be realised and repaid to India within nine months from the date of shipment of goods or from the date of issue of invoice for services.

The proposed rules authorize AD banks to place on a warning list exporters who fail to realize the full value of exports within a specified time period. Such exporters on the warning list can only undertake exports against full advance payment or irrevocable letter of credit.

The rules restrict advance payments for imports of gold and silver, unless approved by the RBI. The rules provide flexibility to exporters who face genuine challenges by allowing AD banks to extend the period for submission of export documents and the period for realization of export proceeds under certain conditions.

Click here to read/download the order