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Indians sent record remittance overseas in January
March 28, 2018, 5:07 pm

As per an RBI data, outward or outbound remittances by Indians for the January month scaled to a new high of $1.2 billion. On a cumulative basis, for the first 10 months of the current FY, the outflows totaled to $8.17 billion in comparison to $4.6 billion in the corresponding period in the year-ago period.

The record remittances were for varied purposes including funding of children's education abroad, for travel related expenditure or sent as gifts or money to relatives abroad.

The rules for sending money or remittance abroad by a resident Indian or NRI are covered under the Foreign Exchange Management Act (FERA). Currently, there is a cap on this overseas remittance by Indian resident at $250,000 per year. The amount can also be remitted in lieu of the some of the select investments. Of the total flows, 90% was remitted towards gifts, travel, education and as maintenance cost for relatives overseas.

Furthermore, of the total, nearly 33% of the total outward remittance is towards the maintenance of relatives abroad and for gifts. The policy for sending outward remittance eased after the foreign reserve of India crossed the historical $100 billion mark in the year 2003. Then came in the liberalized remittance scheme introduced in the year 2014 which allows all residents including minors to engaged in a forex transaction of $2,50,000 per person per financial year.


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