Home › Circulars › RBI/2012-13/480

RBI eases overseas investment rules for Navratna PSUs in oil sector

No longer current — withdrawn, no replacement on file yet
Source: Reserve Bank of India · RBI/2012-13/480 · issued 23 Apr 2013 · ~1 min read
Quick answerRBI now allows Navratna PSUs, OVL, and OIL to invest in incorporated JVs/WOS abroad for oil exploration without limits under automatic route, extending earlier facility for unincorporated entities.

What changed

Previously, Navratna PSUs, OVL, and OIL could invest in unincorporated entities abroad for oil exploration without limits under automatic route. Now, this facility is extended to incorporated joint ventures and wholly-owned subsidiaries in the oil sector, subject to government approval.

What it means for you

Banks handling these transactions can process investments in incorporated entities without seeking RBI approval for limits, as long as government approval is in place. This simplifies compliance for AD banks and reduces processing time for such overseas investments.

Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.

What banks were required to do at the time

Who it affects

AD Category I banks, Navratna PSUs, ONGC Videsh Ltd (OVL), Oil India Ltd (OIL)

❓ Common questions

Regulatory timeline

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

Does this circular remove all limits for these investments?

Yes, for Navratna PSUs, OVL, and OIL, investments in incorporated JVs/WOS in the oil sector abroad are allowed without any limits under the automatic route, provided government approval is obtained.

Do AD banks need to report these transactions differently?

No specific new reporting requirements are introduced; existing reporting under FEMA regulations continues. Banks should follow standard procedures for automatic route investments.

📜 Read the original circular — full text as issued by RBI
RBI/2012-13/480 A.P. (DIR Series) Circular No. 99 April 23, 2013 To, All Category - I Authorised Dealer Banks Madam / Sir, Investment by Navratna Public Sector Undertakings (PSUs), OVL and OIL in unincorporated entities in oil sector abroad Attention of the Authorised Dealer (AD - Category I) banks is invited to the Notification No. FEMA.120/RB-2004 dated July 7, 2004 [Foreign Exchange Management (Transfer or Issue of any Foreign Security) Regulations, 2004] (the Notification), as amended from time to time, and A.P. (DIR Series) Circular No. 59 dated May 18, 2007 and para 3(i) of A.P. (DIR Series) Circular No. 48 dated June 03, 2008 in terms of which Navratna Public Sector Undertakings (PSUs) and ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) are allowed to invest in overseas unincorporated entities in oil sector (for exploration and drilling for oil and natural gas, etc.), which are duly approved by the Government of India, without any limits under the automatic route. 2. On a review, it has now been decided that such facility is also extended to the overseas investments in the incorporated JV / WOS in oil sector (for exploration and drilling for oil and natural gas, etc.) by the Navratna Public Sector Undertakings (PSUs) and ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL), which are duly approved by the Government of India, without any limits under the automatic route. 3. All the other terms and conditions prescribed under the Circulars and Notification under reference shall remain un-changed. 4. AD - Category I banks may bring the contents of this circular to the notice of their constituents and customers concerned. 5. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions/approvals, if any, required under any other law. Yours faithfully, (Rashmi Fauzdar) Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2012-13/480 · issued 23 Apr 2013. The plain-English explanation above is BankPulse’s own independent summary.
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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=7948&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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