The Reserve Bank of India has allowed Indian Residents to purchase foreign equity by way of qualification shares, professionals services and Employee stock option plan. Further, it has been decided to allow general permission to the resident individuals toacquire shares of a foreign entity in full or part consideration of professional services rendered to the foreign company or in lieu of director’s remuneration. It has also been decided that the bank guarantee issued by a resident bank on behalf of an overseas joint venture or wholly owned subsidiary of the Indian party would be considered for computation of financial commitment of the Indian party and reported accordingly.
It has also been decided that the proposals from the Indian party for undertaking financial commitment without equity contribution in joint venture or wholly owned subsidiary may be considered by the RBI under the approval route.
