On June 22, 2023, the Reserve Bank of India (RBI) issued a circular allowing resident individuals to make remittances to the International Financial Services Centres (IFSCs) under the Liberalised Remittance Scheme (LRS) for obtaining foreign education.
Back in February 2021, the RBI permitted remittances under the LRS to IFSCs located in India for making investments in securities. It was decided that a Foreign Currency Account (FCA) in the IFSCs could be created by resident individuals for this purpose, subject to compliance with the prescribed conditions.
In the following year, the Ministry of Finance issued a notification classifying the courses offered by foreign universities or institutions in the IFSC, in Financial Management, Financial Technology, Engineering, Mathematics, etc. as financial services under the International Financial Services Centres Authority Act, 2019. Pursuant to this, the RBI has come out with the said circular allowing remittances to be made by resident individuals to cover the fees payable for pursuing the courses notified by the Finance Ministry.
These directions have been given by the RBI in the exercise of powers conferred under the Foreign Exchange Management Act, 1999.