RBI Amends FEMA Export and Import Regulations 2026: Export Proceeds Realisation Period Reduced to Nine Months 

Introduction

The Reserve Bank of India (“RBI”) has amended the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, reducing the prescribed period for the realisation and repatriation of export proceeds from fifteen months to nine months. The amendment also reduces the period specified in the first proviso to Regulation 5(1) from eighteen months to twelve months and introduces transitional provisions for certain export, import and merchanting trade transactions undertaken before October 1, 2026. 

The Foreign Exchange Management (Export and Import of Goods and Services) (Amendment) Regulations, 2026, were notified on September 22, 2026, and come into force on October 1, 2026. The changes are relevant to exporters, importers, Authorised Dealer banks and businesses engaged in cross-border trade. 

Key Amendments to the FEMA Regulations

1. Reduction in the Period for Realisation and Repatriation of Export Proceeds

The amendment modifies Regulation 5(1) of the principal Regulations by reducing the applicable periods for the realisation and repatriation of export proceeds. The revised timelines are as follows: 

• General period: The prescribed period for realisation and repatriation of export proceeds has been reduced from fifteen months to nine months. 
• Period under the first proviso: The period specified in the first proviso to Regulation 5(1) has been reduced from eighteen months to twelve months. 

The revised periods require exporters to review their existing payment arrangements, receivables-management processes and internal compliance timelines to ensure that export proceeds are realised and repatriated within the applicable period. 

The period under the first proviso applies in the circumstances specified in the Regulations and should not be treated as a general extension available to every exporter. 

2. Transitional Treatment for Exporters on the Caution List

The amendment provides a specific transitional arrangement for exporters appearing on the Caution List as on September 30, 2026. Such exporters will continue to be governed by the relevant existing orders issued by the RBI under Regulation 16 of the Foreign Exchange Management (Export of Goods and Services) Regulations, 2015, until they are removed from the Caution List. 

Accordingly, exporters covered by this provision should assess their position under the applicable existing RBI orders rather than assume that the revised general timelines automatically replace the conditions governing them. 

3. Powers of Authorised Dealers for Certain Legacy Transactions

The amendment also introduces a transitional mechanism for specified export, import and merchanting trade transactions undertaken before October 1, 2026, which previously required RBI approval under the earlier FEMA framework. 

Authorised Dealer (“AD”) banks are empowered to handle the specified transactions in accordance with the amended Regulations. This is intended to facilitate the handling of eligible legacy transactions through the authorised banking framework. 

The provision does not eliminate the need to comply with applicable FEMA requirements or imply that every transaction previously requiring RBI approval can automatically be processed without further scrutiny. The availability of the transitional mechanism depends on the nature of the transaction and the conditions prescribed under the amended Regulations. 

Practical Implications for Businesses

The reduction in the export-proceeds realisation period has implications for businesses engaged in international trade. 

Review of receivables and payment terms: Exporters should review outstanding export receivables, customer payment terms and contractual arrangements to determine whether their existing processes are aligned with the revised timelines. 

Internal monitoring and compliance: Finance teams should review receivables ageing reports, payment follow-up procedures and internal escalation mechanisms to identify transactions that may require closer monitoring. 

Coordination with Authorised Dealer banks: Exporters and importers should coordinate with their AD banks regarding the applicable realisation period, the documentation required for outstanding transactions and the availability of any permitted extensions or transitional arrangements. 

Assessment of legacy transactions: Businesses with export, import or merchanting trade transactions initiated before October 1, 2026, should determine whether the transactions fall within the scope of the transitional provisions and whether any additional documentation or approvals remain necessary. 

Caution List considerations: Exporters appearing on the Caution List as on September 30, 2026, should separately review the applicable RBI orders and the conditions governing their continued operation under those orders. 

Conclusion

The FEMA amendment reduces the general period for realisation and repatriation of export proceeds to nine months and the period specified in the first proviso to Regulation 5(1) to twelve months, effective October 1, 2026. It also establishes transitional treatment for specified legacy transactions and exporters covered by existing Caution List orders. 

Businesses engaged in cross-border trade should review their receivables-management processes, payment arrangements and coordination with AD banks to ensure compliance with the revised framework. 

Primary legislation: Foreign Exchange Management (Export and Import of Goods and Services) (Amendment) Regulations, 2026, Notification No. FEMA 23(R)/(1)/2026-RB, dated September 22, 2026. 

Last Updated on 27 October, 2026