This issue is caused due to AWS RDS permissions. While restoring, when we select restore from a file, Microsoft SSMS searches at the physical location where the database is running. But AWS RDS is designed in such a way that we don't get file-level access to the RDS instance. Instead, we get endpoint and port to connect it.
You can find more at the following link: http://docs.aws.amazon.com/AmazonRDS/latest/UserGuide/SQLServer.Procedural.Importing.html