Banks may permit their overseas branches/correspondents
temporary overdrawals not exceeding Rs.500 lakhs in
the aggregate, for meeting normal business requirements.
This limit applies to the amount outstanding against
all overseas branches and correspondents in the books
of all the branches of the bank in India. This facility
should not be used to postpone funding of accounts.
If overdrafts in excess of the above limit are not adjusted
within five days a report should be submitted to the
Central Office of Reserve Bank (Forex Markets Division)
within 15 days from the close of the month, stating
the reasons therefor. Such a report is not necessary
if arrangements exist for value dating.
Banks wishing to extend any other credit facility in
excess of (i) above to overseas banks should seek prior
approval from the Central Office of Reserve Bank (Forex