FOREIGN

EXCHANGE LAWS
FEMA
Also Covering Provisions
of
COFEPOSA
FCRA
Foreign Trade (Development & Regulations) Act
Custom Act 1962 (Relevant Provisions)
GST (Relevant Provisions)
Foreign Trade Policy

SUDHIR KOCHHAR
(Senior Manager Axis Bank)
(BOOK TITLE GOES HERE)
Copyright © 2017 by (Author or Publisher goes here)

All rights reserved. No part of this book may be reproduced or

transmitted in any form or by any means without written permission
from the author.

ISBN(XXXXXXXXXXXXX)

Printed in India

2
 Table of Contents

Foreword ................................................................... 1
Preface ...................................................................... 3
Introduction ................................................................ 5
Chapter 1 FEDAI ROLE AND RULES OF FEDAI...... 7
Chapter 2 EXCHANGE RATE FUNDAMENTALS. . . 21
Chapter 3 EXCHANGE RATE MECHANISM........... 37
Chapter 4 FORWARD CONTRACTS....................... 71
Chapter 5 RISK MANAGEMENT............................. 93
Chapter 6 AUTHORITIES TO REGULATE TRADE. 97
Chapter 7 LETTER OF CREDIT............................ 101
Chapter 8 FEMA EXPORTS................................... 113
Chapter 9 FEMA IMPORTS................................... 233
Chapter 10 FOREIGN TRADE POLICY................. 247
Chapter 11 OVERSEAS DIRECT INVESTMENT. . 261
Chapter 12 FDI....................................................... 281
Chapter 13 ECB, BUYERS CREDIT...................... 293
Chapter 14 LIBERALISED REMMITANCE............ 261
Chapter 15 EXPORT-IMPORT DOCUMENTS...... 281
Chapter 16 MISCLLANEOUS REMMITANCES..... 293
Chapter 17 BRANCH AND LIASON OFFICE........ 300

3
 Chapter 18 NRI / NRO AND EEFC ACCOUNTS... 310
Chapter 19 EXPORT FINANCE-PCFC.................. 315
Chapter 20 MISCLLANEOUS ACTIVITIES............ 318

ABOUT THE AUTHOR

Sudhir Kochhar is Working in Axis Bank Limited since 9

years in Fema Compliances. He worked with HDFC bank,
Pricewaterhouse Coopers Ltd, Pricewaterhouse (Audit Firm),
Valvoline Cummins LTD, Anil Saran & Associates (CA Firm).
He is Specialised in Transferable Letter of Credit. He has
More than 12 years of experience In Trade Finance.

4
 ACKNOWLEDMENT

This book is written under the guidance of reputed consultants of

FEMA, Experience Professionals’, Chartered Accountants, Companies
Secretaries. I would like to take this opportunity to thanks following
persons under their guidance and support I am able to write a suitable
book for Forex Professionals:
Anil Kumar Singh (Treasury)
PM Pethe (International Forex Trainer)
Karan Butalia Axis Bank)
Srikanth Tadiparthi (Axis Bank)
Manish Vashistha Axis Bank Shanghai)
Shailender Ghalot ( Axis Bank)
Sanjay Malhotra (AUDIT)
Deepak Saxena CA, LLB
Neelam Rattan CA & CFO
Gary Collyer (International Trainer in Letter of Credit)
Shankar Das (Globe Publication Pvt Ltd)
Neeraj Sharma (RSVP Clothing Pvt Ltd)
Vikram Sachdeva (Stich India)

This book is dedicated to my Mother (Suman Kochhar)

and Wife (Gaytri Kochhar) who has taken so much pain
for me to uplift my career.

5
 PREFACE
My aim was to write a short book focusing on basic
fundamentals on foreign exchange operations under
FEMA Act 1999. This book will contain basics features
on Export, Import, FDI, Letter of Credit, Exchange rate
Mechanism, documents used in International Trade with
Foreign trade policy of India. My target audience is all
the Bankers, Banking schools like Indian institute of
Banking and Finance, Foreign Trade institutions. The
great features of this book are:
 Student friendly;
 More than 400 multiple choice questions;
 Very simple language to understand;
 Diagrammatic presentation at the required places
 Fundamentals on Foreign exchange and Trade
Finance
 GST for Exporters / Importers

Phone: 9891743321, 9868415699

Email: Sudhir.kochhar@femalaw1999.in
Website: www.femalaw1999.in, www.femalaw1999.com