| Date: |
05-11-2015
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| Notification No: |
RBI/2015-16/230 A. P. (DIR Series) Circular No. 26
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| Issuing Authority: |
RBI
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| Type: |
A.P.D.(Series) Circulars
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| File No: |
RBI/2015-16/230 |
| Subject: |
Switching from Barter Trade to Normal Trade at the Indo-Myanmar Border
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RBI/2015-16/230
A. P. (DIR Series) Circular No. 26
November 05, 2015
To
All Authorised Dealers in Foreign Exchange
Madam / Sir,
Switching from Barter Trade to Normal Trade at the Indo-Myanmar Border
Attention of the Authorised Dealers is invited to A.D. (G.P. Series) Circular
No.8 dated May 17, 1997 read with
A.P.(DIR Series) Circular No. 17 dated October
16, 2000 in terms of which it has been stipulated that the border trade between
Myanmar and India may be settled through barter system. Further, in terms of
Regulation 3 and 5 of the
Notification No. FEMA 14/2000-RB dated May 3, 2000
[viz. Foreign Exchange Management (Manner of Receipt and Payment) Regulations,
2000] as amended from time to time, the trade transactions with Myanmar may be
settled in any permitted currency in addition to the Asian Clearing Union
mechanism.
- Barter trade was initially permitted to facilitate exchange of locally
produced commodities along the Indo-Myanmar border. As such, these transactions
were not captured in the banking system or reflected in the trade statistics.
However, over a period of time the trade basket has diversified and adequate
banking presence is in place to support normal trade with Myanmar.
- It has, therefore, been decided, in consultation with Government of India, to
do away with the barter system of trade at the Indo-Myanmar border and switch
over completely to normal trade with effect from December 1, 2015. Hence
instructions contained in
A.P. (DIR Series) Circular No. 17 dated October 16,
2000, stand withdrawn. Accordingly, all trade transactions with Myanmar,
including those at the Indo-Myanmar border with effect from December 1, 2015
would be settled in any permitted currency in addition to the Asian Clearing
Union mechanism.
- Authorised Dealers may bring the contents of this circular to the notice of
their constituents concerned.
- Reserve Bank has also amended the Principal Regulations through the Foreign
Exchange Management (Export of Goods & Services) (Second Amendment) Regulations,
2015 notified through
Notification No FEMA.347/2015-RB dated July 24, 2015, vide
G.S.R. No 579 (E) dated July 24, 2015.
- The directions contained in this circular have been issued under Section
10(4) and Section 11(1) of the FEMA, 1999 (42 of 1999) and are without prejudice
to permissions / approvals, if any, required under any other law.
Yours faithfully,
(A. K. Pandey)
Chief General Manager
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