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TMI BlogImport of Gold on Loan Basis – Tenor of Loan and Opening of Stand-By Letter of CreditX X X X Extracts X X X X X X X X Extracts X X X X ..... m/Sirs, Import of Gold on Loan Basis - Tenor of Loan and Opening of Stand-By Letter of Credit Attention of Scheduled Commercial Banks, which are authorized dealers in foreign exchange, is invited to our A.D. (G.P. Series) Circular No.7 dated March 6, 1998 and A.P. (DIR Series) Circular No.2 dated July 9, 2004 wherein nominated agencies, approved banks, Export Oriented Units (EOUs) and Units ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt. As a result the maximum period of gold loan becomes 240 days (i.e. 60 days for manufacture and exports + 180 days for fixing the price and repayment). 3. Banks may note to comply with the following guidelines.: (i) Nominated agencies / approved banks can import gold on loan basis for on lending to exporters of jewellery under this scheme. On the other hand EOUs and units in SEZ who ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required, as per FEDAI guidelines dated April 1, 2003. The tenor of the SBLC should be in line with the tenor of the gold loan. It may be noted that the SBLC can be opened only on behalf of entities permitted to import gold on loan basis, viz. nominated agencies and 100% EOUs/units in SEZ who are in the Gem and Jewellery sector. Further, the SBLC should be in favour of internationally renowned bul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e relevant laws/regulations, the concerned entity should take the approval of the agency concerned before effecting the transaction. 5. ADs may bring the contents of this circular to the notice of their constituents and customers concerned. 6 . The directions contained in this circular have been issued under Section 10 (4) and Section 11 (1) of the Foreign Exchange Management Act (FEMA), 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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