The Reserve Bank of India has today constituted an
internal task force to re-examine the extant regulations and make recommendations
to remove the operational impediments in the path of liberalisation already in
The Task Force will be convened
by Shri Salim Gangadharan, CGM In-Charge, Foreign Exchange Department, Reserve
Bank of India and will have the following terms of reference:
(a) Undertake a review of the extant
regulations that straddle current and capital accounts, especially items in
one account that have implication for the other account, and iron out inconsistencies
in such regulations.
(b) Examine existing repatriation/surrender
requirements in the context of current account convertibility and management
of capital account.
(c) Identify areas where streamlining
and simplification of procedure is possible and remove the operational impediments,
especially in respect of the ease with which transactions at the level of authorized
entities are conducted, so as to make liberalisation more meaningful.
(d) Ensure that guidelines and
regulations are consistent with regulatory intent.
(e) Review the delegation of powers
on foreign exchange regulations between Central Office and Regional offices
of the RBI and inter alia, examine, selectively, the efficacy in the functioning
of the delegation of powers by RBI to Authorised Dealers.
(f) Consider any other matter of
relevance to the above.
The Task Force is empowered to
devise its work procedure, constitute working groups in various areas, co-opt
permanent/special invitees and meet various trade associations, representative
bodies or individuals to facilitate its work. It will make recommendations on
an ongoing basis to rectify the anomalies and remove operational impediments.
The processes are expected to be completed by December 4, 2006.
The report submitted by the
Committee on Fuller Capital Account Convertibility (Chairman, Shri S.S. Tarapore)
has been placed on the RBI website today. The Committee had, while considering
fuller capital account convertibility, incidentally observed that though the
overall regime had undergone a significant degree of liberalisation, in practice,
some regulations relating to an earlier period of tight controls continued to
remain, giving rise to a disconnect between the regulatory intent and the procedure
in use. It has, inter alia, recommended that a Reserve Bank of India task force
should be set up immediately to identify the anomalies in the present regulatory
framework for current and capital accounts and that rectification should be
undertaken within a period of three months.
Chief General Manager
Press Release : 2006-2007/321