(1)    These Regulations may be called the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Amendment) Regulations, 2001.

(2)    They shall come into force with immediate effect.

In the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000,

(i)     in Schedule I, after paragraph 4, the following paragraphs shall be added, namely:

"4A. A registered broker in India may purchase shares of an Indian Company on behalf of a person resident outside India, for the purpose of converting the shares so purchased into ADRs/GDRs,

Provided that:

        i. the shares are purchased on a recognized stock exchange;

        ii. the Indian company has issued ADRs/GDRs;

iii. the shares are purchased with the permission of Custodian of the ADRs/ GDRs of the concerned Indian company and are deposited with the Custodian;

v. the number of shares so purchased shall not exceed ADRs/ GDRs converted into underlying shares and shall be subject to sectoral caps as applicable;

vi. the non-resident investor, broker, Custodian and the overseas depository comply with the provisions of the Scheme for Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 and guidelines issued thereunder by the Central Government from time to time.

(4B)  i) An Indian company may sponsor an issue of ADRs/ GDRs with an overseas depository against shares held by its shareholders at a price to be determined by the Lead Manager.

        ii) The proceeds of the issue shall be repatriated to India within a period of one month.

iii) The sponsoring company shall comply with the provisions of the Scheme for Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 and guidelines issued thereunder by the Central Government from time to time;

iv) the sponsoring