Module: | MODULE A: INTERNATIONAL BANKING
Q60: Consider the following statements regarding remittances to International Financial Services Centres (IFSCs) in India (such as GIFT City):
1.
Resident individuals can remit funds to an IFSC only for the purpose of investment in securities.
2.
Resident individuals can remit funds to an IFSC for payment of fees to foreign universities or institutions set up in the IFSC.
3.
Any funds remitted to an IFSC that remain unused for a period of 15 days must be repatriated to the domestic INR account.
Which of the statements given above is or are correct?
✅ Correct Answer: Option C
🎯 Quick Answer:Statements 2 and 3 are correct. Statement 1 is incorrect because the scope has expanded beyond just securities.
Concept Definition: LRS to IFSC Corridor. IFSCs are treated as non-resident territories for forex purposes. Structural Breakdown: Expanded Scope: Initially, LRS to IFSC was only for securities. Recent updates allow residents to remit funds for Education (payment of fees) to foreign universities establishing campuses within the IFSC. Idle Funds Rule: To prevent parking of funds, any amount remitted to the Foreign Currency Account (FCA) in the IFSC must be utilized for the stated purpose (investment or education) within 15 days. If not used, it must be repatriated back to the domestic savings account in India.