75th Founding Day Lecture Meeting on “India@2030” Know More

July 2008

A.P. (DIR Series) Circular No. 43, dated 29-5-2008 — External Commercial Borrowings Policy — Liberalisation.

By Pinky Shah, Sonalee Godbole, Gaurang Gandhi, Chartered Accountants
Reading Time 1 mins
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Part C : RBI/FEMA


Given below are the highlights of certain RBI Circulars.

 


50 A.P. (DIR Series) Circular No. 43, dated
29-5-2008 — External Commercial Borrowings Policy — Liberalisation.

Presently, borrowers proposing to avail ECB up to US $ 20
million for Rupee expenditure for permissible end-uses require prior approval of
the Reserve Bank under the approval route.

 

This Circular has relaxed the above limit of US $ 20 million
for Rupee expenditure under the approval route as under :

(i) Borrowers in infrastructure sector can avail ECB up to
US $ 100 million.

(ii) Other borrowers can avail ECB up to US $ 50 million.

 


The all-in-cost ceilings in respect of ECB have been revised,
with immediate effect, as under :

Maturity
period

All-in-cost ceiling over 6-month LIBOR for the respective
currency of credit or applicable benchmark
  Existing
 Revised
Three years
and up to five years 		150 basis
points		 200 basis
points
More than five
years 		250 basis
points 		350 basis
points

 

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