counter-trade arrangements with romania
Attention
of authorised dealers is invited to item C of Regulation 14 of the Reserve Bank
Notification No. FEMA. 23/2000-RB dated May 3, 2000, stipulating that prior
approval of the Reserve Bank is required for any arrangement involving
adjustment of value of goods imported into India against value of goods
exported from India.
2. It has
now been decided to allow counter-trade arrangements between Indian and
Romanian parties in which exports from India to Romania may precede imports
into India and the U.S. Dollar Escrow Accounts may be opened and maintained by
the Indian parties with banks in Romania, subject to the condition, among
others, that the Indian exporter should utilise the funds for import of goods
from Romania into India within six months from the date of credit to such
Escrow Accounts. Authorised dealers may forward such proposals to the concerned
Regional Office of Reserve Bank under whose jurisdiction the exporter is
situated. The concerned authorised dealer shall monitor the transactions in the
U.S. Dollar Escrow accounts with banks in Romania through a mirror account.
3. Authorised
dealers may bring the contents of this circular to the notice of their
constituents concerned.
4. The
directions contained in this circular have been issued under Section 10(4) and
Section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999). Any
contravention or non-observance of these directions is subject to the penalties
prescribed under the Act.