External Commercial Borrowing limits are proposed to be linked to borrower?s financial strength says RBI

Reserve Bank of India has stated that it has been decided to rationalize regulations pertaining to External Commercial Borrowing (ECB) included in the Foreign Exchange Management (Borrowing and Lending) Regulations, 2018 issued under FEMA, 1999. The borrowing limits are proposed to be linked to a borrower?s financial strength and ECB are proposed to be raised at market determined interest rates. The end-use restrictions and Minimum Average Maturity requirements are proposed to be simplified. The borrower and lender base eligible for ECB transactions is proposed to be expanded to enhance opportunities of credit flow. Reporting requirements are being simplified to ease compliance obligations.

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