Administration of the Act : The exchange control policy is determined in India by the Ministry of Finance Government of India on the basis of The Foreign Exchange Regulation Act, 1973 (amended in'1993 and 1995). The Act is administered by the Reserve Bank in accordance with the general policy laid down by the Central Government in consultation with the Bank. The Central Government is empowered to give to the Reserve Bank such general or special directions as it thinks fit. The Bank is obliged to comply with these directions in the discharge of its function under the act.
Exchange control is also related to and supplemented by trade control. India's foreign trade (exports and imports) is regulated under the provisions of the Foreign Trade (Development and Regulation) Act, 1992 and Foreign Trade (Regulation) Rules, 1993.Trade control is concerned with the physical transfer of goods whereas exchange control involves related financial transactions: Exchange control is more comprehensive and covers not only exports and imports but invisibles and capital transactions as well. Thus, a close coordination is maintained in the administration of the two controls. The customs authorities have also' an important role to play in the administration of certain aspects of exchange control for example
For enforcing the provision of Foreign Exchange Regulation Act, and dealing with prosecutions and adjudication for evasion or contravention of the regulation there is separate machinery. This is known as Directors of Enforcement, wit11 headquarter in New Delhi and branches in all important places in the country. The central Government may appoint such persons as it thinks fit to, be officers of Enforcement.
Purchase and sale of foreign exchange can be affected only by authorised dealers duly licensed by the Reserve Bank. These licences are generally granted only to commercial banks. However, in recent years licences have been given to some State Corporative Banks as well. Restricted licences have been granted to Industrial Development Bank of India and Export Import Bank. Licences have also been granted to certain established firms, hotels, and other organisations for dealing in foreign currency notes, coins and travellers cheques. They are called Money Changers.