Government
has authorised bidding procedures enabling Indian as well as foreign
companies/entities to bid for the supply of goods and services, Indian
bidders have been permitted to bid in any currency and receive amounts
in such currencies as in the case of foreign bidders. In cases where
such bids providing for payment in foreign currency are accepted from
Indian bidders, it will be necessary for the Indian agency inviting
the bid to make payment in foreign currency to the Indian bidders as
also the Indian bidder to receive payment in foreign currency from the
Indian agency. Reserve Bank has accordingly granted general permission
vide its Notification No.FERA.l25/93-RB dated l5th January 1993, issued
under Section 8(l) of FERA 1973, to persons resident in India to incur
liability in foreign exchange and to make or to receive payments in
foreign exchange in respect of global bids where the Central Government
has authorised bidding procedure enabling Indian as well as foreign
companies/entities to bid for the supply of goods and services for projects
to be executed in India. To enable the concerned Indian companies to
meet their financial obligations in foreign currencies in such cases,
authorised dealers may sell foreign exchange to the concerned resident
Indian company which has awarded the contract on verification of the
Government authorisation and terms of the contract. The Indian bidder
will also be entitled to receive payments in foreign currency in such
cases which should be surrendered to an authorised dealer in foreign
exchange in terms of paragraph 3A.4 of ECM. Authorised dealers may also
treat such foreign currency receipts by the Indian bidders on par with
remittances received from abroad and extend the facility of crediting
the foreign currency receipts to their EEFC account in accordance with
the instructions laid down in Part D of Chapter 14 of ECM. |