Authorised Dealers in India may lend to person resident outside India for making margin payments in respect of settlement of transactions involving Government Securities
RESERVE BANK OF INDIA
(Financial Markets Regulation Department)
MUMBAI, the 24th May 2021
Foreign Exchange Management (Borrowing and lending) (Amendment) Regulations, 2021
No. FEMA. 3(R)2/2021-RB.—In exercise of the powers conferred by Section 47 of the Foreign Exchange Management Act, 1999 (42 of 1999) and in partial modification of its Notification No. FEMA 3(R)/2018-RB dated December 17, 2018, the Reserve Bank makes the following amendment in the Foreign Exchange Management (Borrowing and Lending) Regulations, 2018, as amended from time to time, namely:
2. Short title and commencement: –
(i) These Regulations may be called the Foreign Exchange Management (Borrowing and Lending) (Amendment) Regulations, 2021
(ii) They shall come into force with effect from the date of their publication in the Official Gazette.
3. Amendment of the regulations: –
(i) In the Foreign Exchange Management (Borrowing and Lending) Regulations, 2018, in regulation 7, in clause (A), after sub-clause (ii), the following sub-clause shall be inserted, namely:
“(iii) An AD in India may lend to a person resident outside India for making margin payments in respect of settlement of transactions involving Government Securities by the person resident outside India, subject to such terms and conditions as may be specified by the Reserve Bank.
The expression ‘Government Security’ shall have the same meaning as assigned to it in Section 2(f) of Government Securities Act, 2006, and the word ‘securities’ shall be construed accordingly.
DIMPLE BHANDIA, Chief General Manager
Foot Note: The Principal Regulation was published in the Official Gazette vide G.S.R.No.1213(E) dated December 17, 2018 in Part II, Section 3, sub-Section (i) and subsequently amended vide–G.S.R No. 163(E) dated 26.02.2019
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