The Reserve Bank of India has diluted norms for outsourcing firms in India to draw foreign exchange for buying equipments for new overseas call centres, enabling them to start their foreign journey on a sound note.
It has been decided that authorised banks may allow business process outsourcing firms to pay for equipments to be imported and installed at their overseas sites without physically bringing them to India, which was the requirement till now, said a recent RBI notification.
RBI has modified the procedure following such requests from BPO companies wanting to set up call centres overseas. BPO companies would, however, be required to take necessary approvals from the ministry of information technology in this regard.
Previously, BPO companies were required to produce the exchange control copy of the bill of entry for home consumption as evidence of import of equipments before taking them at overseas locations, which the importers were usually unable to furnish.
Also, RBI Governor Y V Reddy had, while unveiling the annual credit policy, proposed to relax the foreign exchange regulations and provide greater flexibility for such transactions.
The move will also ease some pressure on RBI which is looking for ways to properly utilise the mounting foreign exchange reserves which have crossed the $200 billion mark recently and check the appreciating value of the rupee, analysts said.
In a bid to deal with the rising foreign exchange, the RBI has recently extended the time limit for keeping the foreign currency with individuals and increased the prepayment limit on external commercial borrowings to $400 million from $300 million.
Meanwhile, RBI has also allowed operation of Non-Resident Ordinary Rupee (NRO) account by an Indian resident on the basis of power of attorney granted in his favour by a non-resident account holder.
It, however, restricted such transactions to local payments in the rupee and remittances accruing from the current income of the account holder.
