persons resident outside India, and includes transactions referred to in sub-section (3) of section 6; It generally refers to Capital inflows like Equities, Grants and Debt. Inflows within the country are called as 'Foreign Direct Investment' (FDI). Capital debt is termed - External Commercial Borrowings (ECB). Equity outflows are termed as 'Foreign outbound investment' . Any corporate entity receiving FDI or making an outbound investment has to file an annual FEMA return called as Foreign Liabilities and Assets (FLA). Current Account transaction are defined as transactions other than capital account transactions. Mainly include transactions pertaining to individual remittances, trade, student remittances etc. Main features Activities such as payments made to any person outside India or receipts from them, along with the deals in foreign exchange and foreign security is restricted. It is FEMA that gives the central government the power to impose the restrictions. Free transactions on current account subject to reasonable restrictions that may be imposed. “Without general or specific permission of FEMA, MA restricts the transactions involving foreign exchange or foreign security and payments from outside the country to India – the transactions should be made only through an authorized person”. Deals in foreign exchange under the current account by an authorized person can be restricted by the Central Government, based on public interest generally. Although selling or drawing of foreign exchange is done through an authorized person, the RBI is empowered by this Act to subject the capital account transactions to a number of restrictions. Residents of India will be permitted to carry out transactions in foreign exchange, foreign security or to own or hold immovable property abroad if the currency, security or property was owned or acquired when he/she was living outside India, or when it was inherited by him/her from someone living outside India. Regulations/Rules under FEMA Foreign Exchange Management (Current Account Transactions) Rule, 2000 Foreign Exchange Management (Permissible Capital Account Transactions) Regulations, 2000 Foreign Exchange Management (Transfer or Issue of any Foreign Security) regulations, 2004 Foreign Exchange Management (Foreign currency accounts by a person resident in India)Regulations, 2000 Foreign Exchange Management (Acquisition and transfer of immovable property in India) regulations, 2018 Foreign Exchange Management (Establishment in India of branch or office or other place of business) regulations, 2000 Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2016 Foreign Exchange Management (Export of Goods and Services) regulations, 2015 Foreign Exchange Management (Realisation, repatriation and