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Foreign Exchange Management (Borrowing and Lending in Rupees) (Amendment)
Regulations, 2002
FEMA
Notification No. 67 dated 20th August 2002
In
exercise of the powers conferred by clause (e) of Sub-section (3) of Section 6
and Sub-section (2) of Section 47 of the Foreign Exchange Management Act, 1999
(42 of 1999), and in partial modification of its Notification No. FEMA 4/
RB-2000, dated May 3, 2000, Reserve Bank of India makes the following
Regulations to amend the Foreign Exchange Management (Borrowing and Lending in
Rupees) Regulations, 2000, as amended from time to time, namely: -
1.
Short title and commencement:
(a)
These Regulations shall be called the �Foreign Exchange Management
(Borrowing and Lending in Rupees) (Amendment) Regulations, 2002
(b)
They shall come into force with effect from the date of their publication
in the Official Gazette.
2.
Amendment of the Regulation
In
the Foreign Exchange Management (Borrowing and Lending in Rupees) Regulations,
2000, after Regulation 8, the following Regulation shall be inserted, namely:
�8A
Rupee Loans to NRI/ PIO employees of Indian body corporate
A
body corporate registered or incorporated in India may grant rupee loan to its
employees who is a non-resident Indian or a Person of Indian Origin, subject to
the following conditions, namely:
(i)
The loan shall be granted only for personal purposes including purchase
of housing property in India;
(ii)
The loan shall be granted in accordance with the lender�s Staff Welfare
Scheme/ Staff Housing Loan Scheme and other terms and conditions applicable to
its staff resident in India;
(iii)
The lender shall ensure that the loan amount is not used for the purposes
specified in sub-clauses (i) to (iv) of clause (1) and in clause (2) of
Regulation 6;
(iv)
The lender shall credit the loan amount to the borrower�s NRO Account
in India or shall ensure credit to such Account by specific indication on the
payment instrument;
(v)
It shall be a term of the loan agreement that the repayment of loan shall
be made by way of remittance from outside or from NRE/ NRO/ FCNR Account of the
borrower; and the lender shall not accept repayment made from any other source.
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