You are here: Home » Economy & Policy » News
Business Standard

May outward remittances just shy of $1 bn, up from $847 in year-ago period

Over $364 million went for travel, followed by $248.8 million for maintenance of close relatives and $178 million for education

Abhijit Lele  |  Mumbai 

rbi

Indian residents sent close to $1 billion abroad in May 2018 under the (LRS) to meet expenses for travel, studies abroad and maintenance of close relatives etc.

In the same month last year, they had sent $847 million, according to Reserve Bank of India data.

In April 2018, stood at $929 million. In 2017-18, Indians sent about $11.33 billion abroad through

A look at the pattern of spending in May 2018 shows that out of $996 million, over $364 million went for travel, followed by $248.8 million for maintenance of close relatives and $178 million for education. Gifting came fourth at $118 million and fifth was towards making deposits at $ 31 million.

Under LRS, all resident individuals, including minors, are allowed to freely transfer up to a quarter million dollars per financial year for any permissible current or capital account transaction or a combination of both.

The scheme was introduced in February 2004 with a limit of $25,000. The limit has been revised in stages consistent with prevailing macro and microeconomic conditions.

In April 2018, amended rules for tracking transactions under the remittance scheme. Under the new regime- authorised dealers (AD banks) have to provide daily reports on the transactions. These reports are accessible to all the other AD banks. This was done to improve monitoring and also to ensure compliance with the LRS limits.

Earlier, transactions under the (LRS) were permitted by AD banks based on the declaration made by the remitter. The monitoring of adherence to the limit was confined to obtaining a declaration without independent verification as there was no reliable source of information.

In June 2018, made it mandatory for the remitter to furnish her Permanent Account Number (PAN) for an LRS transaction. PAN is used as a unique identifier to collect remitter-wise data. Earlier, giving PAN was not insisted upon while conducting permissible current account transactions of up to $25,000.

Chart

First Published: Thu, July 12 2018. 00:15 IST
RECOMMENDED FOR YOU