RESERVE BANK OF INDIA
EXCHANGE CONTROL DEPARTMENT
CENTRAL OFFICE
MUMBAI 400 001

A.D.(M.A.Series ) Circular No.47 December 4,1998

To,

All Authorised Dealers in Foreign Exchange

Dear Sirs,


Attention of AD's is drawn to A.D.(M.A.Series) Circular No.26 dated August 7,1998 regarding certain relaxations made in regard to overseas investments by Indian promoter companies out of funds held in EEFC accounts.

The guidelines for Indian Direct Investment in Joint Ventures(JVs) /Wholly Owned Subsidiaries(WOS) abroad have been further liberalised by the Government of India , Ministry of Commerce vide their notifications Nos. 4/1/93-EP(OI) dated 16th April 1998, 28th August 1998, 14th September 1998 and 2nd November 1998 as under:

1. Investment under Fast Track Route of the Reserve Bank
   
   At present proposals for Indian Direct investment are considered by Reserve Bank under its Fast Track Route (FTR) provided the amount of investment does not exceed U.S.$ 4 million (u.S. 15 million in respect of investment in SAARC countries) or Rs. 25 Crores in case of Indian rupee investments in Nepal . This ceiling has now been uniformly raised to U.S.$15 million in respect of Indian Investments abroad in all countries. Limit in respect of lndian rupee investments in Nepal has also been raised to Rs. 60 Crores and this will also be applicable to Bhutan.
   
   
2. Blanket Investment Approval for Overseas Investment by Indian Software Companies
   
   In case of investment in the field of computer software by Indian software companies with cumulative export/foreign exchange realisation of U.S. $ 25 mnb. or more in the preceding three years, blanket investment approval will be given by Reserve Bank upto 50% of such foreign exchange earnings subject to a maximum of U.S.$ 25 million in a block of three consecutive financial years (inclusive of investment , if any, allowed by authorised dealers out of the EEFC accounts under the EEFC Fast Track Window)

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