RBI slaps ₹2,000 crore fine on major Indian PSUs for delayed reporting of overseas investments
Tags: National News
The Reserve Bank of India (RBI) has imposed penalties on four major Indian public sector undertakings for delayed reporting of their overseas investments.
An Overview of the News
The companies that have been fined by RBI include ONGC Videsh Limited, Indian Oil Corporation Limited, GAIL (India) Limited and Oil India Limited and the total amount of fine imposed by RBI is ₹2,000 crore.
Delayed reporting of overseas investments has led to restrictive measures by RBI, affecting further remittances and transfers till discrepancies are resolved.
One of the regulatory measures taken by RBI is to stop outward remittances. Authorised Dealer banks have been instructed not to facilitate any outward remittances or financial commitments by persons resident in India to foreign entities till the reporting issues are regularised.
Penalties for late submission have been imposed retrospectively, covering a significant number of overseas direct investment (ODI) remittances processed since 2000. The companies involved, including SBI, have reported all ODIs on the basis of documents provided by the remittance companies.
In an effort to prevent operational disruptions and comply with RBI regulations, the affected companies have sought an extension from the central bank. They aim to resolve late deposit charges with SBI ODI (Overseas Direct Investment) cell.
Reserve Bank of India (RBI):
The Reserve Bank of India was established under the Reserve Bank of India Act 1934. It started functioning from 1st April 1935
It was nationalised in 1949 and now the Government of India owns the RBI.
It has the power to regulate banks under the Banking Regulation Act 1949.
It has the power to regulate Non-Banking Financial Company (NBFC) under the RBI Act 1934.
RBI is also the regulator of digital payment systems under the Payment and Settlement Act 2007.
Governor: Shaktikanta Das
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