Question

Capital account transactions under FEMA are regulated primarily by whom?

Q: Answer-Capital account transactions under FEMA are regulated primarily by whom?

Under Section 6 of FEMA, capital account transactions are regulated primarily by the Reserve Bank of India, which may, in consultation with the Central Government, specify the permissible classes of capital account transactions and the limits up to which foreign exchange may be drawn. Capital account transactions are subject to greater regulation than current account transactions because they affect the countrys external assets and liabilities. The RBI frames regulations governing such transactions.