Hi Ravi,
I dont know exactly as I have never paid for such services but I think you can pay in dollars by using your existing card....bcz when I had opened an account in paypal.com they have asked there for my bank account number and then after they have debited to my AXIS bank a/c for $1.80 for the testing of genuineness of my account...they have asked me to enter the last 6 digits or so from the narration of my debited entry to ensure that my account is genuine.... in result axis bank debited me exactly the same amount in rupees and that was around 81-82 rs. However paypal have credited $1.80 in my paypal account immediately.
Above entry is also like a payment against services and thats why I am assuming that we can use our existing net banking account or credit/debit card to pay in dollars....
When was this ?????
http://www.msigeek.com/6662/changes-to-paypal-user-agreement-in-india-rbi-guidelines
With effect from 1 March 2011, you are required to comply with the requirements set out in the notification of the Reserve Bank of India governing the processing and settlement of export-related receipts facilitated by online payment gateways (“RBI Guidelines”).
In order to comply with the RBI Guidelines, the PayPal user agreement in India will be amended for the following services as follows:
Any balance in and all future payments into your PayPal account may not be used to buy goods or services and must be transferred to your bank account in India within 7 days from the receipt of confirmation from the buyer in respect of the goods or services; and
Export-related payments for goods and services into your PayPal account may not exceed US$500 per transaction.
These guidelines imply that,
You will not be able receive funds more than US$500
You cannot keep money as a PayPal balance
Your customers will need to link a credit card to their account in before sending you money with PayPal
If you are listing products greater than US$500 per transaction then you may need to seek alternative methods of payment, PayPal will not allow to receive payments for any export-related goods or services for an amount exceeding US$500 per transaction.
Courtesy: PayPal India Notification