FEMA is In, FERA is Out from June 1st, 2000. FEMA indicates a change in the perception from the regulation of foreign exchange to its management, a concept compatible not only with the policy of globalisation and liberalisation of trade, but as an initial step towards capital account convertibility. While issuing ‘simple and transparent rules’ under FEMA, the Reserve Bank of India (RBI) has said that the new law is more transparent in its application. Background and Introduction Since India attained independence, foreign exchange regulations have been the bane of Indian citizens as well as every Indian resident, whether an Indian citizen or not. Originally, exchange controls were imposed under the Defence of India Act of 1939. They were meant to be temporary. Thereafter, the Foreign Exchange Regulation Act, was enacted in 1947, just after India became free, originally for a period of five years, at a time when the country faced ....