FEMA Export-Import Regulations 2026: What You need to know

Created By : Kalpana Karthikeyan, Director - Business Development

In January 2026, the Reserve Bank of India (RBI) introduced the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026. The regulations shall be coming into force on the 1^st of October 2026.

For exporters and importers, these changes are not just regulatory updates or compliance mandates. They will directly impact how cross-border transactions are monitored and managed going forward, bringing added clarity to existing rules.

Consolidation

Over the years, export and import transactions under FEMA have been governed through a combination of regulations, master directions and periodic circulars issued by the RBI. Although each of these served their respective purposes, the end result created a fragmented compliance landscape.

Companies were referring to multiple documents simply to understand the applicable requirements for a transaction.

The new regulations address this issue by consolidating several earlier instructions into a single framework. In practical terms, the objective seems to be greater regulatory clarity and a more streamlined set of rules for businesses engaged in cross-border trade.

Revisiting timelines for export proceeds

Another important area covered under the new framework relates to the realisation and repatriation of export proceeds.

Generally, export proceeds are expected to be realised and brought back into India within 15 months from the date of export. Where the export invoice is denominated and settled in Indian Rupees, the period may extend to 18 months.

Authorised Dealer (AD) banks will still have the discretion to grant extensions where circumstances justify it. That said, the overall framework suggests closer monitoring of receivables that remain outstanding for extended periods.

From a practical standpoint, exporters carrying long-pending export bills may find that banks begin to follow up more actively on such cases.

Link between overdue receivables and future exports

The regulations also draw a clearer connection between unrealised export proceeds and the ability to undertake future export transactions.

Where export proceeds remain outstanding beyond the permitted timeline, exporters may be allowed to continue exporting only against advance payment or an irrevocable letter of credit unless appropriate extensions have been obtained.

In many ways, this reinforces a principle that already existed under FEMA, but the new framework appears to place greater emphasis on monitoring and enforcement.

For businesses, this may simply mean that receivable tracking and follow-up processes will need to become more disciplined.

Cleaning up legacy entries in EDPMS and IDPMS

One provision that may come as a relief for many companies relates to older entries in the EDPMS and IDPMS systems.

Under the revised framework, AD banks will be able to close entries of up to ?10 lakh per bill or record. For organisations that have been dealing with legacy reconciliation issues in these systems, this could provide a practical way to resolve smaller pending items.

Many companies have historical entries that remain open due to documentation gaps or operational mismatches. The ability to close certain entries may therefore help simplify compliance records before the new regulations come into effect.

A larger role for Authorised Dealer banks

Another noticeable shift in the regulations is the increased operational responsibility placed on AD banks.

Banks will now be expected to maintain internal policies and operating procedures for handling trade transactions. They will also need to establish escalation mechanisms and maintain greater transparency around their compliance processes.

This reflects a broader regulatory approach where banks act as the first layer of oversight for foreign exchange transactions. In practice, this could mean more structured engagement between businesses and their AD banks when dealing with export-import transactions.

What to do now

• Review internal processes: Businesses should check their ERP systems and accounting processes so that EDPMS and IDPMS reporting requirements are aligned.
• Check export contracts and payment timelines: Particularly where receivables tend to remain outstanding for longer periods.
• Strengthen documentation: Maintaining clear records for cross-border transactions tends to make interactions with banks and regulators significantly smoother.

Taking stock of these aspects now can help avoid operational disruptions after 1^st October 2026.

The FEMA Export-Import Regulations 2026 help modernise India’s foreign exchange framework. By consolidating existing instructions and strengthening monitoring mechanisms, the RBI is moving towards a more transparent and technology-driven compliance environment.

For businesses engaged in international trade, this also reflects a gradual shift in the way FEMA compliance is approached. From a periodic reporting exercise, it is increasingly becoming an ongoing governance function.

Companies that begin preparing early will find it easier to adapt once the regulations formally come into force.

For further information or assistance in evaluating how these changes may affect your organisation, you may reach out to us at info@akmglobal.in.