Section 8 of FEMA : Section 8: Realisation And Repatriation Of Foreign Exchange

Explanation using Example

Imagine an Indian software development company, TechFront Solutions, that has completed a project for a client based in the United States. The US client is required to pay TechFront Solutions in US dollars for the services rendered. As per Section 8 of The Foreign Exchange Management Act, 1999, TechFront Solutions, being a resident in India, must take reasonable steps to ensure that the payment in US dollars is transferred back to India within a specified period as per the Reserve Bank of India's regulations. This means they cannot keep the dollars abroad indefinitely and must convert them to Indian rupees, bringing the foreign exchange into the Indian economy.