| Blanket Investment Approval for Overseas
Investment by Indian Software Companies
9A.2(A) In the case of overseas investment in the field of computer software by Indian promoter companies with cumulative export/foreign exchange realisation of U.S.$ 25 million or more in the preceding three years, blanket investment approval will be given by Reserve Bank upto 50% of such foreign exchange earnings subject to a maximum of U.S.$ 25 million in a block of three consecutive financial years. The approved amount will be inclusive of investments, if any, allowed by authorised dealer out of EEFC accounts in terms of paragraph 9A.5. The ceiling of U.S.$ 25 million will cover equity, loan and 50% of contingent liabilities like guarantees. An Indian promoter company desiring to obtain such blanket approval should submit an application in form ODB, along with documents indicated therein, to the Chief General Manager, Exchange Control Department, Overseas Investment Division (OID), Reserve Bank of India, Central Office, Amar Building, Fort, Mumbai-400001. Remittances within the amount of blanket approval may be made either for setting up a new JV/WOS abroad or for additional equity or loan in respect of existing JV/WOS already approved by the Reserve Bank/Government of India/authorised dealer. On receipt of such blanket approval, the Indian promoter company may apply for release of foreign exchange to the authorised dealer in form A2 along with the particulars of investments in form ODI in respect of new JV/WOS and in form ODS in respect of additional investment in an existing JV/WOS abroad. Authorised dealers may allow remittances to the extent of the amount mentioned in the Blanket Approval without seeking further approval from Reserve Bank. Immediately after effecting remittance, authorised dealer should forward a copy of Form A2 together with a copy of Form ODI or ODS (in duplicate) as the case may be giving the details of investment, citing the number and date of the blanket approval, to the concerned Regional Office of Reserve Bank. On receipt of particulars of investment, Reserve Bank will allot a unique Identification Number in respect of newly set up JV/WOS. Authorised dealers would continue to forward original A2 form alongwith the R-Return in which the sale is reported as hitherto. |