New Delhi:  The Reserve Bank of India (RBI) has unveiled new regulations under the Foreign Exchange Management Act (FEMA), facilitating the listing of Indian companies on international stock exchanges.

These regulations are seen as a significant step in enabling companies to utilise foreign exchange more effectively and expand their global presence.

The first set of regulations addresses the mode of payment and reporting for non-debt instruments. According to the notification, the proceeds from the purchase or subscription of equity shares of an Indian company listed on an international exchange shall either be remitted to a bank account in India or deposited in a foreign currency account of the Indian company.

Additionally, the sale proceeds (net of taxes) of the equity shares can be remitted outside India or credited to the bank account of the permissible holder.

The investee Indian company, through an authorised dealer, will be responsible for reporting transactions involving foreign exchange. In cases where a Foreign Portfolio Investor (FPI) makes an investment through a stock exchange, the authorized dealer will report the transaction to the RBI.

The second set of regulations pertains to foreign currency accounts held by a resident in India.

If funds have been raised through External Commercial Borrowings (ECBs), American Depository Receipts (ADRs), Global Depository Receipts (GDRs), or direct listing of equity shares of Indian companies on international exchanges but are yet to be utilised or repatriated, they must be held in foreign currency accounts with a bank outside India

Experts believe that these new FEMA regulations will streamline the process for Indian companies seeking to list on global stock exchanges, providing them with greater flexibility and access to international capital markets.