📷 Image Credits: Mint
The Reserve Bank of India (RBI) has recently made a significant announcement, allowing resident Indians to open foreign currency accounts in the International Financial Services Centres (IFSCs) at GIFT City. This decision comes as part of the expansion of the Liberalised Remittance Scheme (LRS) by the apex bank.
The new directive permits authorised persons to facilitate remittances for various financial services or products within IFSCs, in accordance with the International Financial Services Centres Authority Act, 2019. Resident individuals can now conduct all current or capital account transactions in any foreign jurisdiction (other than IFSCs) through a Foreign Currency Account (FCA) held in IFSCs.
This development opens up opportunities for resident Indians to engage in a wide range of activities such as investments, insurance, and education loan payments in foreign currencies within GIFT City. Tapan Ray, the Managing Director and Group CEO of GIFT City, expressed his enthusiasm for the decision, highlighting the potential for resident investors to leverage the platform for overseas investments and expenditures.
The move by the RBI aligns GIFT IFSC with other global financial centers and enhances the utility of the LRS for investments and transactions like insurance and education loan payments in foreign currency. It will provide residents with greater flexibility and options for managing their finances and investments in the international market.
The announcement is expected to have a positive impact on the financial landscape in India, opening up new avenues for residents to explore overseas investments and financial opportunities. This decision by the RBI reflects the ongoing efforts to align the country’s financial regulations with international standards and promote growth and development in the financial sector.
