External commercial borrowing (ECB) norms are not likely to be relaxed any further soon, sources in the finance ministry indicated on Friday.
“Can you think of any other relaxation?” asked a senior finance ministry official in reply to a question on the possibility of easing ECB norms more.
While suggesting no further scope for relaxation in ECB as demand for external borrowing has grown across sectors, the official said, “Money is flowing in through ECBs.”
The government has been taking monetary and fiscal measures to combat the slowdown, brought about by the global financial crisis.
After various curbs put on ECBs to restrict the flow of foreign capital in India to arrest rupee appreciation last year, the government has been relaxing this route of raising money abroad.
Earlier, it allowed infrastructure firms to bring in $100 million to India for rupee expenditure against $20 million. Similarly, other firms were allowed to bring in $50 million.
It further relaxed this norm by allowing companies to bring in $500 million for rupee or dollar expenditure on the automatic route.
The Government has also expanded the definition of infrastructure firms for accessing ECBs by including mining, exploration and refining.