The Reserve Bank of India said on Sunday it would allow investors who sell their local shares to companies for conversion into American Depository Receipts or Global Depository Receipts to keep the money from the sale in a foreign currency account.
The central bank said the move was aimed at further liberalising the rules and procedures, adding the conversions were subject to the clearance by the government's foreign investment panel.
In November, the RBI allowed companies to offer investors the option of converting their local shares into ADRs or GDRs listed on the London and Luxembourg Stock Exchanges and keep the proceeds in a domestic currency account.
The RBI said on Sunday that investors would now be allowed to keep the amount in foreign currency-denominated accounts such as an Exchange Earners Foreign Currency account and Resident Foreign Currency (Domestic) account, besides in their rupee-denominated accounts.
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