The grandparents who are Indian citizens would like to send money from India to the United States to gift their grandkids who are US citizens residing in US. Are there any restrictions on how much they can send?
From India tax point of view, your grandparents are Resident Indian; grandchildren are Non Resident Indian. This would be treated as Gift from India taxation. There is no tax liability in India for your grandparents. Under the liberalized remittance scheme they can transfer upto 250K every year outside of India without much paperwork. Please check with the bank.