(i) Purchase of ships/aircraft by Indian shipping/airline companies requires approval of Ministry of Surface Transport/Ministry of Civil Aviation, Government of India. Shipping/airline companies wishing to acquire ships/aircraft should, therefore, approach Government of India for permission. Purchase of ships/aircraft will generally require remittances towards advance/down payments, obtaining of foreign currency loans, issue of guarantees, etc. Applications for these purposes should be submitted to Reserve Bank by the shipping/airline company through an authorised dealer together with a certified copy of letter of approval issued by Government for acquisition of the ship/aircraft, certified copy of the contract, and other supporting documents.

(ii) In cases where purchase of ships/aircraft is to be made out of a foreign currency loan/credit, a certified copy of the foreign currency loan/credit agreement should also be forwarded indicating whether repayment of the loan/credit will be made out of surplus passage, freight collections or earnings retained abroad or by remittances made from India. In approved cases, Reserve Bank will permit the authorised dealer to issue bank guarantee and to effect remittances towards repayment of the loan, interest etc. where necessary. Reserve Bank will also allot a registration number to each foreign currency loan/suppliers credit approved and advise it to the shipping/airline company while conveying its approval to the proposal. The registration number should invariably be quoted in all correspondence with the Reserve Bank regarding the loan/credit. The registration number should also be cited on form A2 covering remittances made or rupee transfers effected under the loan/credit arrangement. The procedure with regard to drawal, utilisation and repayment of loan/credit shall be the same as described in paragraphs 7 B.6 and 7 B.7. Authorised dealers and borrowers should ensure strict compliance with these provisions.

(iii) The import of aircraft, helicopters, ships and containers on financial lease basis will also be governed by the provisions contained in sub-paragraphs (i) and (ii) above.