Issues in Capital Account
And Current Account
Transactions
BARODA BRANCH OF WIRC, ICAI
CA Rajesh H. Gandhi
16 February 2013
Agenda
• Overview
• Capital Account Transactions
• Foreign Direct Investment (FDI)
• External Commercial Borrowing (ECB)
• Overseas Direct Investment (ODI)
• Current Account Transactions
• Liberalized Remittance Scheme (LRS)
2
Overview
3
Overview Of Current And Capital Account Transactions
Capital Account
Remittance
Prohibited unless
specifically
permitted
Freely permitted
Subject to
ceilings**
Approving
authority
Foreign Investment
Promotion Board
Authorized Dealers
Central
Government/RBI

Illustration
4
Current Account
Purchase of
machinery on
credit or
borrowing
outside India
for such
purchase
Purchase of machinery for cash
**Approval required
where ceilings breached
Capital Account Transactions
5
Capital Account Regulations
• Permissible Capital Account Transactions – Para 3 of the Capital Account
Regulations
(A) transactions of a person resident in India specified in Schedule I
(B) transactions of a person resident outside India specified in Schedule II
• Prohibited Capital Account Transactions – Para 4 of the Capital Account
Regulations
‒
‒
‒
‒
‒
Business of chit fund
Nidhi Company
Agricultural or plantation activities
Real estate business, or construction of farm houses,
Trading in Transferable Development Rights (TDRs)
Real estate business does not include development of
townships, construction of residential/commercial
premises, roads or bridges.
6
Permissible Capital Account Transactions
Investment by person resident in India
Investment by person resident outside India
[Schedule I, Regulation 3(1)(A)]
[Schedule II, Regulation 3(1)(B)]









Direct investment in India
External commercial borrowings
Transfer of immovable property outside India
Guarantees issued in favour of a person
resident outside India
Export,
import
and
holding
of
currency/currency notes
Maintenance of foreign currency accounts in
India and outside India
Loans and overdrafts to a person resident
outside India.
Remittance outside India of capital assets of a
person resident in India.
Sale and purchase of foreign exchange
derivatives in India and abroad and commodity
derivatives abroad.
 Investment in India i.e.,—
o In security issued by a body corporate or an
entity in India; and
o to the capital of a firm or a proprietorship
concern or an association of persons in India.
 Acquisition and transfer of immovable property in
India.
 Guarantee in favour of, or on behalf of, a person
resident in India.
 Import and export of currency/currency notes
into/from India
 Deposits between a person resident in India and a
person resident outside India.
 Foreign currency accounts in India
 Remittance outside India of capital assets in India
of a person resident outside India.
Subject to applicable conditions
7
FDI
8
Background
• Inbound investments are regulated by
‒ Reserve Bank of India ("RBI")
‒ Department of Industrial Policy & Promotion (FC Section), Ministry of Commerce,
Government of India
• Under section 6(3)(b) of the FEMA
‒ RBI has the power to prohibit, restrict or regulate the transfer or issue of any security by
a person resident outside India
• RBI has issued FEM (Transfer or issue of security by a person resident outside
India) Regulations, 2000 ("FEMA 20/2000")
‒ to regulate the transfer / issue of shares by certain persons resident outside India subject
to certain terms and conditions specified in Schedules to the aforesaid Regulations
‒ FEMA 20/2000-RB, dated 3 may 2000 [GSR 406(E), dated 3 May 2000]
• RBI also issues annual master circular on "Foreign Investments in India" that
deals with inbound investment in India
‒ Latest Master Circular on "Foreign Investments in India“ is dated 2 July 2012 (updated
as on 12 February 2013)
9
Background…
• Further, Ministry of Commerce and Industry (Department of Industrial
Policy and Promotion), Government of India (GOI) has released
Consolidated FDI Policy vide Circular 1 of 2012 dated 10 April 2012
which is effective from the same date.
• DIPP issues Press Notes which provide guidance on various issues
including foreign investment in India
• Press Notes and FEMA Regulations are to be read together
• FAQs on foreign Direct Investment in India updated on October 11,
2011
10
Background…
Foreign
Investments
FDI
Portfolio
Investments
Automatic
route
Approval
Route
NR
FII
Venture Capital
Investments
Other
investments
(G-sec, NCDs, etc.)
FIIs
NRI,
PIO, QFI
SEBI regd.
FVCIs
VCF, IVCUs
11
Investment on
non repartriable
basis
NRI, PIO,
QFI
NRI, PIO
India’s FDI Policy – Sectoral view
Sectors – Automatic
Route
(Illustrative)




Agriculture & Animal
husbandry
NBFC (subject to
minimum capitalization
norms)
Insurance – 26%
Special Economic
Zones


Alcohol Distillation


Mining

12
Private Sector Banking
up to 49%
Petroleum & Natural
Gas
Cash & Carry wholesale
trading
Sectors –Approval
Route
(Illustrative)
 Existing Airports beyond
74%
 Asset Reconstruction
Companies - 49%
 Broadcasting
 Telecom Service beyond
49% upto 74%
 Private Sector Banking
beyond 49%
 Print Media
 Tea Sector
 Defence - 26%
Sectors – Negative List
(Illustrative)
 Atomic energy
 Lottery, betting and
gambling
 Business of chit fund
 Nidhi company
 Trading in Transferable
Development Rights
 Cigars, cheroots,
cigarillos and cigarettes
 Real estate business
Question Break
-
Can FDI be received in a business / venture which is not incorporated under any law
in India?
Single Brand Retail Trading
• 100% permitted under approval route
• Conditions
‒ Single brand products only
‒ Product should be sold under same brand internationally
‒ Products are branded during manufacturing
‒ Only one non-resident entity, whether owner of the brand or otherwise, permitted
to undertake single brand product retail trading for the specific brand (earlier
condition that foreign investor should be owner of brand deleted)
‒ Retail trading by means of e-commerce not permitted
• Application for approval to indicate the product / product categories
proposed to be sold under a “single brand”
• Fresh approval required for any addition to product / product category
• For proposals beyond 51%, mandatory sourcing of at least 30% of value of
manufactured / processed products from India preferably from MSMEs,
village and cottage industries, artisans and craftsmen
• First compliance over a period of 5 years from the year of receipt of
1st tranche of FDI. Subsequently on an annual basis
Multi Brand Retail Trading
• 51% permitted under approval route
• Conditions
‒ Minimum amount to be brought in – USD 100 million
‒ 50% of the total FDI brought in shall be invested in ‘backend infrastructure’ within
3 years of the first tranche of FDI. It will include capital expenditure on all
activities, excluding that on frond-end units (clarified to include investment
towards processing, distribution, quality control, storage etc.)
‒ At least 30% of value of manufactured / processed products purchased to be
sourced from Indian small industries/village and cottage industries, artisans and
craftsmen. First compliance over a period of 5 years from the year of receipt of 1st
tranche of FDI. Subsequently, on an annual basis
‒ Retail sales outlets to be set up only in areas meeting specified criteria
‒ Government will have the first right to procurement of agricultural products
‒ Retail trading by means of e-commerce not permitted
Expenditure on land and rent will not be counted
for the purpose of ‘backend infrastructure’
Multi Brand Retail Trading ~ Issues…
• Whether entire capital of 100 million to be brought upfront or within
specified time frame
• Whether investment in purchase of existing business would be considered
towards meeting the minimum investment criteria
• Continuous requirement to invest 50% in backend capital expenditure may
be difficult to achieve
• Mandatory sourcing of 30% from small scale industries
‒ Challenges in achieving economies of scale and consistency in quality
‒ Increase in cost on account of procurement in small quantity and training of
multiple suppliers
‒ Challenges associated with switching to another supplier when small scale
supplier outgrows its size
Transfer of Shares
• Transfer of shares from NR to R or R to NR freely permitted subject to
sectoral restrictions
‒ However transfer of shares from NRI to NR requires prior permission of RBI
• Deferred payment
‒ Transfer from R to NR – Prior approval required from RBI
‒ Transfer from NR to R – No specific provision
‒ Reporting in form FC TRS to be done within 60 days from date of receipt of
consideration (initial/final?)
• Reduction of share capital – no specific reporting requirement
• Liquidation of companies
‒ Proceeds can be remitted to NR only after receipt of approval of official Liquidator
~ Liquidator would grant final approval only after remittance is made
Question Break
-
Can a foreign company (other than FII/QFI) buy/sell Indian shares on the stock
market
Indirect Foreign Investment
• Direct Investment
‒ Any non-resident investment in an Indian company
• Indirect Foreign Investment
‒ Investment in an Indian company by another Indian company having foreign
investment.
• Investing company
‒ An Indian company holding only investment in other Indian company/(ies), directly
or indirectly, other than for trading of such holding / securities.
Indirect Foreign Investment
NREs
Overseas
India
Say, 51%
Say, 49%
Investing
Company
Say, 26% /
80%
Indian
Company
20
RICs / ICs
Owned by RIC
and IC
If more than
50% of the
equity interest
is beneficially
owned by RIC
and ICs which
are owned and
controlled
ultimately by
RICs
Control by RIC
and IC
If RIC and IC
which are
owned and
controlled by
RIC have the
power to
appoint
majority of its
directors
Yes
Yes
Whether
indirect foreign
investment by
investing
company in
Indian
company
counted?
Not counted
• Shareholding of investing company into
Indian company will not be considered as
foreign investment
• In this case, foreign investment will be NIL
Indirect Foreign Investment
NREs
Overseas
India
Say, 49%
Say, 51%
Investing
Company
80%
Indian
Company
RICs / ICs
Owned by RIC
and IC
If more than
50% of the
equity interest
is beneficially
owned by RIC
and ICs which
are owned and
controlled
ultimately by
RICs
Control by RIC
and IC
If RIC and IC
which are
owned and
controlled by
RIC have the
power to
appoint
majority of its
directors
Yes
No
Counted
No
Yes
Counted
No
No
Counted
• Proportionate theory will not apply
• Shareholding of investing company into
Indian company will be considered as foreign
investment
• In this case, 80%
21
Whether
indirect foreign
investment by
investing
company in
Indian
company
counted?
Indirect Foreign Investment
NREs
Overseas
India
Say, 49%
RICs / ICs
Say, 51%
Investing*
Company
Say, 100%
Indian
Company
*Including operating-cum-investing company
22
• Exception – if operating-cum-investing
company / investing company invests
100% in Indian company then the
foreign investment limited to the foreign
investment in the operating cum
investing / investing company
• It is clarified that this exception is
being made since the downstream
investment of a 100% owned
subsidiary of the holding company is
akin to investment made by the
holding company and the down
Stream investment should be a mirror
image of the holding company.
• In this case, 51%
Issues in Indirect Foreign Investment
• Operating-cum-investing Indian
company is owned or controlled by
NREs
NREs
Overseas
• Operating-cum-holding company
holds 95% in its subsidiary
India
Say, 26%
Say, 74%
Operatingcum-Investing
Company
Say, 95%
Indian
Company
RICs / ICs
• Whether indirect foreign investment
will be considered in Indian
Company?
• Whether loan or investment in
redeemable preference shares will be
allowed?
The Indirect Foreign Investment
rules only cover cases of
Operating-cum-Investing
companies which own 100% of
Indian Company
Question Break
-
Can Downstream Investment be made using internal accruals?
Investment in Limited Liability Partnership (‘LLP’)
-
FDI in LLPs is permissible under the approval route where operating in sectors /
activities where 100% FDI is allowed under the automatic route
-
No FDI linked performance conditions
-
FDI in agricultural/plantation activity, print media or real estate not allowed
-
No FDI by FII and FVCI
-
Downstream investment by IC having FDI allowed, if both (the IC and LLP) operate
in 100% automatic sector
-
No downstream investment by LLP with FDI
-
An LLP is not allowed to make an outbound investment under the automatic route. It
would need to access the approval route which could be ordinarily granted (ROC
does not allow LLPs to register if they have investments as part of their objects).
-
RBI approval would be needed for a company wanting to convert itself into an LLP if
it holds overseas investments
Issues on Indirect Investment in LLP
• Operating-cum-investing Indian
company is owned or controlled by
NREs
NREs
Overseas
• Operating-cum-holding company
holds 95% in its subsidiary
India
Say, 26%
RICs / ICs
Say, 74%
• Does LLP have any foreign
investment (direct or indirect)?
- No?
Operatingcum-Investing
Company
• Can LLP make any downstream
investment?
- Yes?
Say, 95%
.??
LLP
A Co
ECBs
27
Discussion points
• Conversion of ECB into Equity
‒ Conversion permissible even though the ECB is not due for repayment
• End-use
‒ Permitted end-use includes investment in new projects and modernization / expansion of
existing production units
‒ Can proceeds of ECB be used for acquiring an industrial undertaking on a slump sale
basis
28
ODI
29
Background
• Outbound investments are regulated by
‒ Reserve Bank of India ("RBI")
• Under section 6(3)(a) of the FEMA
‒ RBI has the power to prohibit, restrict or regulate the transfer or issue of any foreign
security by a person resident in India
• RBI has issued Foreign Exchange Management (Transfer or issue of any
foreign security) Regulations, 2004
‒ to regulate acquisition and transfer of a foreign security by a person resident in India
i.e. investment by Indian entities in overseas joint ventures (“JV”) and wholly owned
subsidiaries (“WOS”) as also investment by a person resident in India in shares and
securities issued outside India
‒ FEMA 120/RB-2004 dated July 7, 2004
• RBI also issues annual Master Circular on "Direct Investment by Residents in
Joint Venture (JV) / Wholly Owned Subsidiary (WOS) Abroad " that deals with
Outbound investment of India
‒ Latest Master Circular on Direct Investment by Residents in Joint Venture (JV)/ Wholly
Owned Subsidiary (WOS) Abroad dated 02 July 2012
• FAQ on Overseas Direct Investment updated on June 20, 2012
Outbound investment under the automatic route
• An Indian party can invest upto 400% of its net worth (as per last audited
Balance Sheet) in JV / WOS for any bona fide activity permitted as per the law
of the host country, if certain other specified conditions are satisfied.
‒ For the purpose of reckoning the net worth of 400%, the Indian party may use the net worth of its
parent company (holding at least 51% in Indian company) or its subsidiary company (in which 51%
is held by the Indian Company) to the extent holding or subsidiary have not availed of by the holding
company or subsidiary company independently.
• Discussion Points
‒ Does the 400% net worth criterion apply only at the time of making the investment or
through out the period of investment (fall in net worth)?
‒ Net worth of indirect parent and subsidiary cannot be considered
‒ JV not defined ~ level of investment / contribution?
Net worth means paid up capital (including preference
shares) and free reserves
31
Other Points
• JV / WOS through a Special Purpose Vehicle
‒ Direct investment through the medium of a SPV is permitted under the Automatic
Route for the purpose of investment in JV / WOS overseas
‒ Can an Indian company have more than one SPV for making investment in various JV
/ WOS
‒ Loan not permitted to step down subsidiary unless Indian company has equity
investment in step down ~ extent of equity investment required not specified
• No clarity on whether Indian resident can be a beneficiary of a foreign trust ~
discretionary vs. non discretionary trust ~ whether a capital account transaction
• Designated Authorized Dealer
‒ In case the JV/WOS is being set up abroad by two or more Indian promoters, then all
Indian promoters would be required to route all transactions in respect of that JV/WOS
only through one ‘designated authorized dealer’
32
Expatriates
• Whether foreign citizens and other persons permanently resident in India
allowed to invest abroad out of foreign currency resources
‒ In terms of section 6(4) of FEMA person resident in India can continue to hold or invest in foreign
assets if such asset was held when the person was a resident outside India
‒ RBI Circular 37 of 19/10/2011 clarifies that under section 6(4), person resident in India can reinvest
out of proceeds of assets sold outside India and income and sale proceeds of assets need not be
brought to India
‒ Whether above relaxation applies to foreign citizens (heading of Circular only refers to NRIs)
‒ As per ODI regulations, only persons not permanently resident in India allowed to purchase foreign
securities from foreign resources outside India – Whether persons permanently resident in India
(including foreign citizens) not allowed to invest out of foreign resources inspite of relaxation under
Circular 37
33
Current Account
Transactions
34
Current Account Transaction Rules
• Any person may sell or draw foreign exchange to or from an authorised
person if such sale or drawal is a current account transaction, unless restricted
by RBI
• FEM( Current Account Transactions) Rules, 2000
‒ Transactions for which foreign exchange withdrawal is prohibited (Schedule I)
‒ Transactions require approval of the Central Government ( Schedule II)
‒ Transactions require approval of Reserve Bank of India (Schedule III)
Current Account Transaction Rules…
Rule 3 [Schedule I] Transaction prohibited
(Illustrative)



Remittance out of lottery winnings

Payment of commission on exports made towards equity investment in Joint
Ventures/Wholly Owned Subsidiaries abroad of Indian companies

Remittance of interest income on funds held in Non-resident Special Rupee Scheme
Account
36
Remittance of income from racing/riding etc, or any other hobby
Remittance for purchase of lottery tickets, banned/prescribed magazines, football
pools, sweepstakes etc
Current Account Transaction Rules…
Rule 4 - Approval of the Central Government
(Illustrative)


Cultural Tours
Remittance of hiring charges of transponders by:
(a) TV Channels Ministry of Information and Broadcasting;
(b) Internet Service Providers Ministry of Communication and Information Technology

Remittance of prize money/sponsorship of sports activity abroad by a person other
than International / National / State Level sports bodies, if the amount involved
exceeds USD 1,00,000

Advertisement in foreign print media for the purposes other than promotion of tourism,
foreign investments and International bidding (exceeding USD 10,000) by a State
Government and its Public Sector Undertakings

Multi-model transport operators making remittance to their agents abroad
Current Account Transaction Rules
Rule 5 – Approval of the Reserve Bank
(Illustrative)
 Release of exchange exceeding USD 10,000 or its equivalent in one financial

year for one or more private visits to any country (except Nepal and Bhutan)
Gift remittance exceeding USD 5,000 per financial year per remitter or donor other
than resident individual
 Exchange facilities exceeding USD 100,000 for persons going abroad for
employment
 Exchange facilities for emigration exceeding USD 100,000 or amount prescribed
by country of emigration.
 Remittance for maintenance of close relatives abroad
(i) exceeding net salary (after deduction of taxes, contribution to provident fund and
other deductions) of a person who is resident but not permanently resident in India
and—
(a) is a citizen of a foreign State other than Pakistan; or
(b) is a citizen of India, who is on deputation to the office or branch or subsidiary
or joint venture in India of such foreign company
(ii) exceeding USD 100,000 per year per recipient, in all other cases
Travel Abroad
Purpose
Foreign Exchange Compliance
When can foreign exchange be
drawn for going abroad
•
Not before 60 days prior to the date of travel
One or more private visit to any
country
•
•
Foreign currency notes equivalent to USD 3,000
Total foreign currency drawal upto USD 10,000.
Exchange facilities for persons
going abroad
•
Upto USD 1,00,000
Exchange facilities for emigration
•
Upto USD 1,00,00 or amount prescribed by
country of emigration
For business travel, or attending a
conference or specialized training,
study tour, or for maintenance
expenses of a patient going abroad
•
Upto USD 25,000 per visit, for a person,
irrespective of period of stay
For meeting expenses for medical
treatment abroad
•
Upto USD 1,00,000 or amount as per the
estimate from a hospital/doctor in India/abroad,
whichever is higher
For studies abroad
•
Upto USD 1,00,000 per academic year or as per
the estimate from the institution abroad,
whichever is higher
Travel Abroad…
Purpose
Drawal of currency permissible
Maximum amount in INR that could
be carried while on a visit abroad
and brought back on return
•
INR 7,500
Maximum cash in foreign currency
that could be carried while on a visit
abroad and brought back on return
•
Foreign currency notes equivalent to USD 3,000
while going abroad
On return, without any limit. However, if the
aggregate value of foreign exchange exceeds
USD 10,000 or foreign currency notes alone
exceeds USD 5,000, it should be declared to the
Customs Authorities at the Airport in the Currency
Declaration Form on arrival in India.
Maximum amount that can be paid
in cash for drawing foreign
exchange
•
•
•
Upto Rs 50,000
If the Rupee equivalent exceeds Rs. 50,000,
entire payment should be made by way of a
crossed cheque / banker’s cheque / pay order /
demand draft, etc.
Expatriates
• Employees of foreign companies on deputation to Indian subsidiary /
branch / joint venture allowed to receive salary directly in foreign bank
account subject to payment of tax in India
‒ Whether Indian company to whom the employees are deputed can directly pay salary
into the foreign bank account
• Employees who are (i) citizens of foreign State or (ii) citizens of India
on deputation to office/branch/subsidairy/joint venture in India can
make remittance for close relatives outside India as under:
‒ Upto net salary if the employment is for a specific duration (irrespective of
length) or a specific job which does not exceed a duration of three years
‒ Upto USD 100,000 in other cases
41
Liberalized Remittance
Scheme
42
Background
• Under the LRS, all resident individuals, including minors are allowed to freely remit up to
USD 2,00,000 per financial year for any permissible current or capital account transaction,
which is given below
• Consolidation of remittance facility in respect of family members, subject to compliance with
the terms and conditions of the scheme.
Permissible usage of LRS (Illustrative)
 Current account transactions

43 Permitted capital account transactions
 Remittance for purchase of objects of art
subject to other relevant regulations
 Remittance of funds for acquisition of ESOP
(this is in addition to acquisition of ESOPs
linked ADR / GDR)
 Repayment of loan availed abroad as an
NRI
Usage prohibited (Illustrative)




Remittance for any purpose specifically
prohibited under Schedule-I (like purchase of
lottery tickets/sweep stakes, proscribed
magazines, etc.) or any restricted items;
Remittances for purchase of FCCBs issued by
Indian companies in the overseas secondary
market;
Remittance by a resident individual for setting
up a company abroad;
Remittances directly or indirectly to countries
identified by the FATF as ‘non co-operative
countries and territories’
No need to repatriate to India the income generated from
property acquired abroad out of LRS
Issues
• Whether remittance can be made under LRS for
investment in unlisted (private) companies
‒ Specific restriction for remittance towards setting up new companies
‒ No specific restriction / permission for acquisition of stake in private
companies ~ not a “permissible capital account transaction”
• However remittance allowed for acquisition of immovable property abroad which is
also not a permissible capital account transaction
• Form 15CA/CB required even if the remittance is not
taxable ~ variance in practice followed by Banks
• Cases where Banks have insisted on form A2 even though
not required under LRS
Remittance for travel, medical, studies etc. (except gift and
donation) over and above limit under LRS
44
Issues
• Rupee gift by resident to NRI relative allowed under LRS ~
amount to be credited to NRO account
‒ Does it circumvent restriction of USD 5,000 for gifts under current account
rules considering NRI can remit USD 1 million out of NRO account balance
• Loans to non residents not permitted except to NRI/PIO
close relatives subject to conditions
• Limit of USD 200,000 cannot be exceeded even if
proceeds of investments bought back to India
45
Glossary
FEMA
Foreign Exchange Management Act, 1999
Capital Account
Regulations
The Foreign Exchange Management (Permitted Capital
Account Transactions), Regulations 2000
RIC
Resident Indian Citizens
IC
Indian Companies
NRE
Non Resident Entities
FII
Foreign Institutional Investors
FVCI
Foreign Venture Capital
46
Section 2(e) – Definition - Capital Account Transaction
Section 2(e)
• “Capital account transaction" means a transaction which alters the assets or liabilities,
including contingent liabilities, outside India of persons resident in India or assets or
liabilities in India of persons resident outside India, and includes transactions referred to in
sub-section (3) of section 6
47
Section 6(3) - Capital Account Transaction
Section 6(3)
“Without prejudice to the generality of the provisions of sub-section (2), the Reserve Bank
may, by regulations prohibit, restrict or regulate the following,—
a) transfer or issue of any foreign security by a person resident in India;
b) transfer or issue of any security by a person resident outside India;
c) transfer or issue of any security or foreign security by any branch, office or agency in
India of a person resident outside India;
d) any borrowing or lending in foreign exchange in whatever form or by whatever name
called;
e) any borrowing or lending in rupees in whatever form or by whatever name called between
a person resident in India and a person resident outside India;
f) deposits between persons resident in India and persons resident outside India;
g) export, import or holding of currency or currency notes;
h) transfer of immovable property outside India, other than a lease not exceeding five years,
by a person resident in India;
i) acquisition or transfer of immovable property in India, other than a lease not exceeding
five years, by a person resident outside India;
j) giving of a guarantee or surety in respect of any debt, obligation or other liability
incurred,—
i. by a person resident in India and owed to a person resident outside India; or
ii. by a person resident outside India”
48
Section 2(j) – Definition - Current Account Transaction
Section 2(j)
• “current account transaction" means a transaction other than a capital account
transaction and without prejudice to the generality of the foregoing such
transaction includes,—
i.
payments due in connection with foreign trade, other current business,
services, and short-term banking and credit facilities in the ordinary course
of business,
ii.
payments due as interest on loans and as net income from investments,
iii. remittances for living expenses of parents, spouse and children residing
abroad, and
iv. expenses in connection with foreign travel, education and medical care of
parents, spouse and children;
49