Section 6 in The Foreign Exchange Management [Withdrawal Of General Permission To Overseas Corporate Bodies (Ocbs)] Regulations, 2003
6. Permission to hedge certain transactions .-An OCB may enter into a forward contract with rupee as one of the currencies with an Authorised Dealer (AD) in India to hedge--
(i)the amount of dividend due to it on an existing investment in the form of shares of an Indian company;(ii)the balance held in an existing Foreign Currency Non-Resident (FCNR) account or Non-resident External Rupee (NRE-Rupee) Term Deposit account;(iii)the amount of existing investment made under Portfolio Investment Scheme in accordance with the provisions of the Foreign Exchange Regulation Act, 1973 or under the notifications issued thereunder or made in accordance with the provisions of the Foreign Exchange Management (Transfer or issue of Security by a Person Resident Outside India) Regulations, 2000, and in both cases subject to the terms and conditions specified in the proviso to paragraph 1 of Schedule II to the Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations, 2000, as amended from time to time.
