Para 3.10.11 — MSO (Audit)
Original Rule Text
3.10.11 Foreign exchange requirements of other diplomatic Missions and Posts abroad, with the exception of the Mission in Nepal, are met by the Ministry of External Affairs and also by the Ministry of Commerce in the case of trade sections not attached to the Mission by means of remittances through the Reserve Bank of India. The Embassy of India, Nepal, Kathmandu, obtains funds directly from the Reserve Bank of India, Calcutta. The Missions maintain books of Reserve Bank of India drafts for making payments in India to their employees and their nominees. The remittances are designed so as to ensure that the monthly closing balance of the Mission does not exceed its six weeks’ net average requirement for recurring expenditure. Special remittances are also made for non-recurring expenditure. But if these remain unutilised for over two months, the balance funds are adjusted by suitable reductions in the normal monthly remittances to the Mission.
What This Means
Most Indian missions abroad receive their foreign exchange through remittances from MEA and the Ministry of Commerce (for unattached trade sections) via the Reserve Bank of India. The Nepal embassy is an exception — it gets funds directly from RBI Kolkata. Missions maintain RBI draft books for making payments in India. Remittances are calibrated so that a mission's closing balance does not exceed six weeks' net average recurring expenditure. Special remittances for non-recurring items must be used within two months or offset against future monthly remittances.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Foreign exchange needs met through MEA/Commerce Ministry via RBI
- 2Nepal embassy funded directly from RBI Kolkata
- 3Missions maintain RBI draft books for India payments
- 4Monthly closing balance must not exceed six weeks' net average recurring expenditure
- 5Special remittances for non-recurring expenditure must be used within two months
- 6Unutilized special remittances are adjusted against future monthly remittances
Practical Example
The Indian Embassy in Tokyo has average monthly recurring expenditure of JPY 30 million. Its monthly closing balance should not exceed JPY 45 million (six weeks' worth). When MEA sends a special remittance of JPY 10 million for a visiting delegation that gets cancelled, the embassy must reduce its next monthly remittance request by JPY 10 million if the funds remain unused after two months.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Why is the six-week balance limit important?▼
Why is the Nepal embassy treated differently?▼
What is a Book of RBI Drafts?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.