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

Sep 18, 2003

Savings - Interest is paid at par with domestic deposits. Currently it is 3.5 per cent.

Term deposits - Fixed or floating rates of interest within the ceiling rate announced by RBI from time to time. At present the rate is USD LIBOR/SWAP rates of corresponding term plus 100 basis points.

Current - No interest is paid.

Term deposit can be placed with ADs in India in 4 specific foreign currencies.

Rate of Interest - Fixed or floating within the ceiling rate of LIBOR/SWAP rates for the respective currency/corresponding term minus 25 basis points.

Savings - Normally operated for crediting rupee earnings / income such as dividends, interest. Currently the interest rate is 3.5 per cent.

Term Deposit - Banks are free to determine interest rates.

Current - No interest is paid.

Authorised Dealers can allow remittance/s upto USD 1 million, per calendar year from balances in NRO accounts subject to payment of applicable taxes. The limit of USD 1 million per year includes sale proceeds of immovable properties held by NRIs/PIOs for a period of 10 years. In case a property is sold after being held for less than 10 years, remittance can be made after the sale proceeds have been held in the account for the balance period.

• Government dated securities/treasury bills.

• units of domestic mutual funds.

• bonds issued by a public sector undertaking (PSU) in India.

• shares in Public Sector Enterprises being dis-invested by the Government of India, provided the purchase is in accordance with the terms and conditions stipulated in the notice inviting bids.

• shares and convertible debentures of Indian companies under FDI scheme (including automatic route & FIPB).

• shares and convertible debentures of Indian companies through stock exchange under Portfolio Investment Scheme.

• Deposits with Indian companies, non-banking finance companies registered with RBI, housing finance companies and other financial institutions.

• units of Money Market Mutual Funds in India.

• the capital of a firm or proprietary concern in India, not engaged in any agricultural or plantation activity or real estate business.

NRIs can acquire –

• immovable property in India other than agricultural/plantation property or a farmhouse.

PIOs can acquire -

• immovable property other than agricultural land/farm house/plantation property in India out of repatriable funds.

NRIs and PIOs can repatriate –

• sale proceeds of immovable property acquired in India to the extent of repatriable funds used for acquiring the property, without any lock-in period, upto two residential properties.

• refund of application/earnest money/purchase consideration made by house-building agencies/seller on account of non-allotment of flats/plots/cancellation of booking/deals for purchase of residential/commercial properties, together with interest, net of taxes, provided original payment is made out of NRE/FCNR(B) account/inward remittances.

(v) Facilities to returning NRIs/PIOs:

• may continue to hold, own, transfer or invest in foreign currency, foreign security or any immovable property situated outside India, if such currency, security or property was acquired, held or owned when resident outside India.

• may open, hold and maintain with an authorised dealer in India a Resident Foreign Currency (RFC) Account to transfer balances held in NRE/FCNR(B) accounts. Proceeds of assets held outside India at the time of return, can be credited to RFC account. The funds in RFC accounts are free from all restrictions regarding utilisation of foreign currency balances including any restriction on investment in any form outside India.