Mumbai, Sep 22 (UNI) The Reserve Bank of India today enhanced the existing limit for External Commercial borrowings for infrasatructure from USD 100 to USD 500 Million per financial year for rupee expenditure for permissible end uses under the approval route.
RBI, in a review of the current ECB Policy, announced certain modifications in view of the huge funding requirements of the sector, the Apex bank said in a release here.
RBI said ECBs in excess of USD 100 million for Rupee expenditure should have a minimum average maturity period of 7 years.
In view of widening of credit spreads in the international financial markets, the all-in-cost ceilings over six months LIBOr for ECBs with over seven year maturity period had been increased by 100 bais points to 450 basis points. This would be applicable for the respective currency of borrowing or applicable benchmark.
The amendments to the ECB guidelines will come into force with immediate effect. All other aspects of the ECB policy such as USD 500 million limit per borrower per financial year under the Automatic Route, eligible borrower, recognised lender, end-use of foreign currency expenditure for import of capital goods and overseas investments, average maturity period, prepayment, refinancing of existing ECB and reporting arrangements remain unchanged.
The existing limit of USD 50 million for Rupee expenditure under the Approval Route for borrowers other than those in the infrastructure sector also remains unchanged.
UNI VK OBB NP1943