The Finance Ministry has issued a notification to allow an individual to spend $2.5 lakh abroad in a year. This comes almost three months after the Reserve Bank of India announced raising the same. Earlier, the limit was $1.25 lakh dollar, but with forex reserves getting stronger at over $353 billion, a higher limit has been notified. The higher limit can be used by an individual for private visits to any country (except Nepal and Bhutan), gift or donation, going abroad for employment, emigration, maintenance of close relatives abroad, travel for business, or attending a conference or specialised training, medical expenses and studies abroad.
The RBI reduced the eligibility limit for foreign exchange remittances under the Liberalised Remittance Scheme (LRS) to $ 75,000 in 2013. With stability in the foreign exchange market, this limit was enhanced to $ 1.25 lakh dollar without end-use restrictions, except for prohibited foreign exchange transactions such as margin trading, lotteries and the like. On a review of the external sector outlook and as a further exercise in macro prudential management, the RBI on February 3, decided to enhance the limit under the LRS to $ 2.5 lakhs per person per year.
Now, It has also been said in the notification that if an individual remits any amount under the LRS in a financial year, then the applicable limit for such individual would be reduced from $ 2.50 lakh by the amount so remitted. This facility will be available for a person who is a resident but not a permanent resident in India. This facility will be available to all foreign nationals (except those who are from Pakistan) besides Indian citizen who is on deputation to the office or branch of a foreign company or subsidiary or joint venture in India of such foreign company.