MUMBAI, July 3: In a significant move towards full convertibility of the Indian rupee, the Reserve Bank of India (RBI) today substantially relaxed rules for the release of foreign exchange for certain activities which include employment and basic travel quota (BTQ).

According to the new rules authorised dealers (ADs) can now release forex upto US $ 3,000 per person per annum towards BTQ, $ 2,500 per person for going abroad on employment, $ 1,000 per person each year towards gifts to relatives and friends and $ 1,000 for donations to charitable, educational, religious and cultural organisations abroad.

Earlier, ADs could release forex upto $ 2000 per beneficiary towards BTQ, $ 500 per beneficiary per year as gift, $ 500 towards donations per person or $ 1000 per family for emigration. ADs will now be able to effect advance remittances for imports not carrying a bank guarantee from the present $ 5,000 to $ 15,000 or equivalent, according to the RBI.

For tie-up arrangements for surface transportation, the overall ceiling for the forex amount to be released by ADs is $ 50,000. As also the advance payment upto 10 per cent. Permit has been given to release exchange under tie-up arrangements between Indian agents and overseas principals for booking hotel accomodation abroad. The forex release for tie-up arrangements on pre-paid telecards have now been fully delegated to the ADs.

``For emigration purposes, $ 3,000 or the amount required by the country of emigration per person/member of the family is now allowed to be released subject to production of documentary evidence of emigration,'' RBI said.

Powers have now been delegated to ADs in case of remittances of surplus freight collection by official carriers. They can also send remittances of surplus passage/freight collection by foreign shipping companies.

After the appointment of break bulk agent is approved by RBI, the designated branch of the AD can now allow the remittance of the agent's remuneration on outward consolidation of air cargo to the break bulk agent abroad.

According to the RBI, remittances on consolidation of outbound cargo by sea can now be allowed through the designated branch of the AD after obtaining approval from RBI for appointing break bulk agent abroad.

Remittances of freight pre-paid on inward consolidation by sea can also be made through the designated branch of the centre at which the registered or head office of the break bulk agent is located. The RBI, on application, will approve the arrangement. Operating expenses of Indian airlines or shipping companies can be released through the designated branch of the AD as per the actual requirement.

ADs will now be allowed to make remittances of remunerations to agents of Indian airlines or shipping companies abroad on the basis of agreement between them. For remittances of operational charges by Indian courier companies, RBI will renew the non-objection certificates and grant fresh ones to the new arrangements.

``Remittances thereafter will be allowed by the designated branch of the AD at the centre at which the registered or head office of the courier company is located. The remittances will be on a minimum monthly basis,'' the RBI said.

Powers have also been delegated to the ADs for allowing charter-hire in respect of export/import cargo. The remittances, however, will be allowed through designated branch only. Remittance for advance payment with regard to import cargo will now continue to be dealt with by the RBI. Remittances by multimodal transport operators to their overseas agents can be made through the designated branch.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.