External commercial borrowing (ECBs) are loans in India made by non-resident lenders in foreign currency to Indian borrowers. They are used widely in India to facilitate access to foreign money by Indian corporations and PSUs (public sector undertakings).
Fema / RBI : Explains how ECBs allow Indian entities to borrow abroad while ensuring compliance with RBI rules. Key takeaway: growth is enabled...
Fema / RBI : The new ECB framework removes rigid conditions and introduces flexibility in borrowing and repayment. It significantly improves ea...
Fema / RBI : The 2026 amendment replaces rigid interest rate ceilings with market-determined pricing. The reform expands borrowing flexibility ...
Fema / RBI : Revised ECB framework allows broader borrower and lender participation while eliminating fixed interest spread ceilings. Borrowing...
Fema / RBI : The RBI’s 2026 amendment liberalizes External Commercial Borrowings by removing cost caps and raising borrowing limits while ret...
Fema / RBI : Presenting the General Budget 2012-13 in LokSabha here today, ShriPranab Mukherjee, Finance Minister announced various majors for ...
Fema / RBI : With a view to rationalising the present arrangements relating to foreign portfolio investments by Foreign Institutional Investors...
Fema / RBI : Those exercising the option include Mahindra & Mahindra, Reliance Communications, Tulip Telecom, Moser Baer, Jubilant Organosys, R...
Finance : Reserve Bank of India has issued A. P. (DIR series) circular no. 26 dated October 22, 2008, to modify some aspects of the ECB poli...
Income Tax : ITAT Mumbai held that set off of loss of Permanent Establishment [PE] against the interest income received from External Commercia...
Fema / RBI : i) increase the automatic route limit from USD 750 million or equivalent to USD 1.5 billion or equivalent. ii) increase the all...
Fema / RBI : As a measure of simplification of the existing procedures, it has been decided to delegate powers to the designated AD Category-I ...
Fema / RBI : Hitherto, Indian corporates in the services sectors viz., hotels, hospitals and software were allowed to avail ECB upto USD 100 mi...
Fema / RBI : India's central bank on Tuesday eased oversees borrowing rules for Infrastructure Finance Companies (IFC). The IFC's will not nee...
Fema / RBI : Attention of Authorised Dealer Category - I (AD Category - I) banks is invited to Notification No.FEMA 29/2000-RB dated September ...
EXTERNAL COMMERCIAL BORROWINGS; External Commercial Borrowings (ECBs) are loan made by non-resident lenders in convertible foreign exchange to the Indian borrowers. ECBs are the instruments through which loans are availed by India borrowers from foreign sources. ECBs include bank loans, buyer’s credit, supplier’s credit, securitised instruments, such as floating rate notes, fixed rate bonds, etc. […]
Presenting the General Budget 2012-13 in LokSabha here today, ShriPranab Mukherjee, Finance Minister announced various majors for mitigating shortage of housing for low income groups. The Finance Minister proposed allowing External Commercial Borrowings (ECB) for low cost affordable housing projects and setting-up of a Credit Guarantee Trust Fund to ensure improved flow of institutional credit for housing loans.
As a measure of simplification of the existing procedures, it has been decided to delegate powers to the designated AD Category-I banks to approve the request from the ECB borrowers with respect to change in the recognized lender when the original lender is an international bank or a multilateral financial institution (such as IFC, ADB, CDC, etc.) or a regional financial institution or a Government owned development financial institution or an export credit agency or supplier of equipment and the new lender also belongs to any one of the above mentioned categories, subject to the Authorised Dealer ensuring the following conditions:
Hitherto, Authorised Dealers Category – I Banks (AD) were allowed to permit pledge of shares held by the Promoters as security for External Commercial Borrowings (ECB) availed by the Borrowing Resident Investee Company subject to prescribed conditions. As a measure of liberalisation and simplifications, the Reserve Bank of India (RBI) has now permitted ADs to allow pledge of shares of an Indian Company held by Non-Resident Investor/s subject to certain key conditions outlined below.
Hitherto, Indian corporates in the services sectors viz., hotels, hospitals and software were allowed to avail ECB upto USD 100 million per financial year under the automatic route for permissible end-uses. ECB beyond USD 100 million was arguably not permissible even under the approval route.
India’s central bank on Tuesday eased oversees borrowing rules for Infrastructure Finance Companies (IFC). The IFC’s will not need the central bank’s nod to raise overseas funds equivalent to or less than half of their own funds, the Reserve Bank of India (RBI) said in a statement.
Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to Notification No.FEMA 29/2000-RB dated September 26, 2000 viz. Payment to person resident outside India on invocation of guarantee, A.P. (DIR Series) Circular No. 28 dated March 30, 2001 and A.P. (DIR Series) Circular No. 5 dated August 1, 2005 relating to External Commercial Borrowings (ECB).
As per the extant policy, eligible borrowers in the telecommunication sector are permitted to avail of ECB for the purpose of payment for spectrum allocation, under the automatic route. Keeping in view the large outlay of funds required to be paid directly to the Government within a limited period of time, it has been decided to make a one-time relaxation in the end-use conditions of the ECB policy.
With a view to rationalising the present arrangements relating to foreign portfolio investments by Foreign Institutional Investors (FIIs)/ Non Resident Indians (NRIs) and other foreign investments like Foreign Venture Capital Investor (FVCI) and Private Equity entities etc., the Government has decided to set up a working group to look at various types of foreign flows, which are taking advantage of arbitrage across the respective stand-alone regulations and generate recommendations to Government.
Attention of Authorized Dealer Category – I (AD Category – I) banks is invited to the A.P. (DIR Series) Circular No. 46 dated January 2, 2009, A.P. (DIR Series) Circular No. 64 dated April 28, 2009 and A.P. (DIR Series) Circular No. 71 dated June 30, 2009 relating to External Commercial Borrowings (ECB).
