Section 5(4) in The Foreign Exchange Management (Deposit) Regulations, 2000
(4)[. A Qualified Foreign Investor (QFI) may open a single non-interest bearing Rupee Account with Authorised Dealer in India without the prior approval of the Reserve Bank, for the limited purpose of routing the receipt and payment for transactions relating to purchase and sale of eligible securities as stipulated by the Reserve Bank, from time to time, subject to the following conditions:(a)The account shall be funded by inward remittance through normal banking channel and by credit of the sale/redemption/buyback proceeds (net of taxes) and on account of interest payment/dividend on the eligible securities for QFIs.(b)The funds in this account shall be utilized for purchase of eligible securities for QFIs or for remittance (net of taxes) outside India.(c)The Qualified Depository Participants (as per the extant SEBI regulations) will operate such non-interest bearing. Rupee Accounts on behalf of the QFIs and at the instructions of the QFIs.]
