The Reserve Bank of India task force on capital account convertibility for reviewing rules on current and capital accounts has made a number of recommendations on the move toward fuller capital account convertibility.
Following are the highlights:
- Ban fund inflows under PNs,
- Provide PN holders exit route,
- Phase out PNs within a year,
- Raise ECB ceiling for automatic approval,
- Allow NRIs to invest in capital markets,
- Allow tax benefits for NRI deposits,
- Review tax benefits/treaties,
- Improve banking regulation/supervision,
- Raise aggregate MF investments limit to $5 billion in 5 years,
- Allow all NRIs to access FCNR deposit schemes,
- Raise overseas investment by MFs to $3 bn by this year,
- Remove NAV limits on MF overseas investments.
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