Key Restrictions on Foreign Exchange Transactions in India
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Buying and selling of foreign exchange abroad is generally regulated under the Foreign Exchange Management Act (FEMA). When dealing with foreign currency transactions, NRIs can benefit from their NRI accounts to manage these exchanges seamlessly.
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Purchase of lottery tickets is prohibited under the Liberalized Remittance Scheme (LRS) for NRIs. However, NRIs can use their NRI online account opening to manage their finances for other legal activities abroad.
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A gift from one resident Indian to another resident Indian in foreign currency is allowed within certain limits, but NRIs should make sure they have a valid non-resident Indian bank account to facilitate such transactions.
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LRS is not available to any corporations other than individuals. NRIs, however, can open an FCNR account or a NRO to NRE transfer to transfer funds abroad for personal use.
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Some incomes are not allowed to be transferred abroad under LRS. For instance, NRIs must ensure that they follow proper guidelines for fund transfer from NRO to NRE and comply with the regulations on how to transfer money to NRE account.
Also Read: What are borrowing and lending rules for NRI as per FEMA?