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  • Comparison Between FERA AND FEMA

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    Anubhav Rathore
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    FERA and FEMA both regulate foreign exchange in India, but FEMA replaced the older FERA. FERA was enacted when foreign exchange reserves were low and took a more rigid approach, while FEMA was introduced later when reserves were satisfactory and uses a more flexible approach. Some key differences are that FERA had more sections, determined residential status based on citizenship, and violations were considered criminal offenses with imprisonment as punishment, while FEMA has fewer sections, bases status on time spent in India, and views violations as civil offenses with fines or imprisonment.

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    Economics Fema vs Fera comparison

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    Fema and Fera

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    FERA and FEMA both regulate foreign exchange in India, but FEMA replaced the older FERA. FERA was enacted when foreign exchange reserves were low and took a more rigid approach, while FEMA was introduced later when reserves were satisfactory and uses a more flexible approach. Some key differences are that FERA had more sections, determined residential status based on citizenship, and violations were considered criminal offenses with imprisonment as punishment, while FEMA has fewer sections, bases status on time spent in India, and views violations as civil offenses with fines or imprisonment.

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    6 views1 page

    Comparison Between FERA AND FEMA

    Uploaded by

    Anubhav Rathore
    FERA and FEMA both regulate foreign exchange in India, but FEMA replaced the older FERA. FERA was enacted when foreign exchange reserves were low and took a more rigid approach, while FEMA was introduced later when reserves were satisfactory and uses a more flexible approach. Some key differences are that FERA had more sections, determined residential status based on citizenship, and violations were considered criminal offenses with imprisonment as punishment, while FEMA has fewer sections, bases status on time spent in India, and views violations as civil offenses with fines or imprisonment.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 1

    Comparison between FERA AND FEMA

    BASIS FOR
    FERA FEMA
    COMPARISON

    Meaning An act promulgated, to FEMA an act initiated to


    regulate payments and facilitate external trade and
    foreign exchange in payments and to promote
    India, is FERA. orderly management of the forex
    market in the country.

    Enactment Old New

    Number of sections 81 49

    Introduced when Foreign exchange Foreign exchange position was


    reserves were low. satisfactory.

    Approach towards Rigid Flexible


    forex transactions

    Basis for Citizenship More than 6 months stay in


    determining India
    residential status

    Violation Criminal offence Civil offence

    Punishment for Imprisonment Fine or imprisonment (if fine not


    contravention paid in the stipulated time)

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