India to Tighten Remittance Rules, Bar Offshore Deposits

India's central bank plans to tighten rules for overseas remittances by resident Indians, barring them from holding foreign currency deposits with lock-in periods, two government sources said.

- Reuters

MUMBAI:

The Reserve Bank of India (RBI) will amend regulations to prevent overseas transfers from being used to park money in time deposits or other interest-bearing accounts abroad, one of the sources said.

"This is akin to passive wealth shifting, which is a red flag for the RBI in a still-controlled capital regime," the first source familiar with the thinking of the central bank said.