India Reduces Limit on Annual Outbound Remittances, EB-5 Impact Likely to Follow
On August 14, 2013, the Reserve Bank of India (RBI) announced a series of measures designed to stem the sharp decline in currency value as the rupee fell to an all-time closing low against the dollar. The new policies, which aim to ease pressure on the rupee and stem the flow of foreign currency outside the country, reduce the limit on overseas direct investment by Indian companies (other than oil companies with majority government ownership) from 400 percent of net worth to 100 percent. In addition, the new measures also decrease the limit on annual outbound remittances from $200,000 to $75,000 per person, a shift that may have implications for Indian EB-5 investors who must demonstrate a minimum $500,000 investment in a U.S. commercial enterprise to qualify for permanent residency under the Immigrant Investor Program. In a sign of changes yet to come, Finance Minister P. Chidambaram noted that the RBI's "temporary" measures should not be viewed as a form of capital control and would be revisited "at an appropriate time."