Q. Consider the following statements regarding “Liberalized Remittance Scheme (LRS)”:
1. It was launched after the subprime lending crisis.
2.It aims to simplify and streamline the process of remitting funds outside India.
Which of the statements given above is/are correct?

[A] 1 only

[B] 2 only

[C] Both 1 and 2

[D] Neither 1 nor 2

Answer: B
Notes:

Explanation: LRS is a foreign exchange policy initiative introduced by the Reserve Bank of India (RBI) in 2004. Its aim is to simplify and streamline the process of remitting funds outside India.

  • Under LRS, resident individuals can freely remit funds up to a certain limit for various permissible transactions involving a current or capital account.
  • Prior to LRS, remittance is controlled by FEMA 1999.

Source: FORUMIAS

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