In case you are not following the issue, paypal has updated their blog yesterday about the codes which all Indian paypal users have to fill now, you can check the post here which is self explanatory.

So from now on, while withdrawing money, we need to fill a code (thankfully, no Import export license as earlier I had thought), you can see all the codes either on thepaypalblog or at RBI’s site

Most of the freelancers like me should fell under category P0802 as I do consultancy work and programming, for those who are in SEO and marketing, they may have to fill P0803 or P1007 code. You can look at the RBI doc to fully understand your codes.

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