What are the major provisions of Foreign Exchange Management Act?

What are the major provisions of Foreign Exchange Management Act?

Provisions of Foreign Exchange Management Act (FEMA) provides free transaction on current account subject to the guidelines by the RBI. Enforcement of Foreign Exchange Management Act (FEMA) is entrusted to a separate directorate, which undertakes investigations on contraventions of the Act.

What is Foreign Exchange Management Act 2000 discuss its main provisions?

This law’s main objective is to increase the flow of foreign exchange in India. Now , under this law , you can bring foreign currency in India without any legal barrier . According to section 3 of FEMA 2000 ,” only authorized person under the govt. terms can deal in foreign exchange in India .

What are the objectives of Foreign Exchange Management Act?

The main objective behind the Foreign Exchange Management Act (1999) is to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments. It was also formulated to promote the orderly development and maintenance of foreign exchange market in India.

Why is exchange control necessary?

Exchange controls are government-imposed limitations on the purchase and/or sale of currencies. These controls allow countries to better stabilize their economies by limiting in-flows and out-flows of currency, which can create exchange rate volatility.

What is Exchange Bank answer?

Solution. Exchange banks are banks which facilitate foreign exchange transactions.

What are the features of foreign exchange market?

Features of Foreign Exchange Market

• High liquidity. The foreign exchange market is the most liquid financial market in the world.
• Market transparency.
• Dynamic market.
• Operates 24 hours.
• Lower trading Cost.
• Dollar most Widely Traded.
• Spot Market.
• Forward Market.

What is bank exchange?

A currency exchange is a licensed business that allows customers to exchange one currency for another. Currency exchange of physical money (coins and paper bills) is usually done over a counter at a teller station, which can be found in various places such as airports, banks, hotels, and resorts.