Mr. Pravesh, an Indian National, wishes to obtain foreign exchange for: (i) US$ 140,000 for studies abroad, based on an estimate from the foreign…

(i) Foreign exchange for studies abroad: Provisions: Under the Liberalised Remittance Scheme [Schedule III, the FEM (Current Account Transactions) Rules, 2000], a resident individual may remit up to US$ 250,000 per financial year for permitted purposes, including studies abroad, without RBI approval. The proviso to Para 1 of Schedule III additionally permits remittance beyond US$ 250,000, without RBI's prior approval, where the remittance is supported by an estimate from the foreign institution demanding the higher amount. Analysis: Since Mr. Pravesh's requirement of US$ 140,000 is within the US$ 250,000 ceiling, he may draw this foreign exchange without RBI's prior approval, through an Authorised Person. (ii) Foreign exchange for hiring charges of transponders: Provisions: Under Section 5 of the FEMA, 1999, current account transactions are freely permitted subject to any reasonable restrictions the Central Government may impose by rule. Schedule II to the FEM (Current Account Transactions) Rules, 2000 specifically requires prior approval of the Ministry of Information & Broadcasting and the Ministry of Communication and Information technology for remittance of hiring charges of transponders. Analysis: Mr. Pravesh must therefore obtain the Ministry's approval before drawing US$ 10,000 for this purpose. Conclusion: In both cases, foreign exchange may be drawn only through an Authorised Person as defined in Section 2(c) of the FEMA, 1999.