Tag: ECB Policy
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RBI’s Draft Framework on ECB: The Background
[This guest post is by Pratik Datta, who is a Consultant at the National Institute of Public Finance and Policy (NIPFP), New Delhi. He can be reached at prat.nujs@gmail.com.] Yesterday the Reserve Bank of India (RBI) released the draft framework for External Commercial Borrowing (ECB) for public comments on or before October 11, 2015. For
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RBI Proposal on Rupee Linked Bonds
In the past, rupee denominated bond issuances have essentially been available to multilateral institutions, of which the International Finance Corporation (IFC) had availed of them. Now, the Reserve Bank of India (RBI) has announced a draft framework, which allows Indian companies as well to tap this avenue for raising debt. Indian corporates that are eligible
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RBI Circular on Security for External Commercial Borrowings
The Reserve Bank of India (RBI) prescribes stringent norms on external commercial borrowings (ECBs) as also the grant of security in favour of foreign lenders or suppliers who have extended ECBs to Indian borrowers. While clarity has been developing over the years, there has often been doubt regarding specific types of securities and guarantees to
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RBI Clarification on Overseas Investment Norms
In a previous post, Satyajit had discussed the Reserve Bank of India’s (RBI) policy measures announced on August 14, 2013 to restrict overseas direct investments (ODI). Primarily, it was decided to reduce the ODI limits of a company from 400% of its net worth to 100%. Yesterday, the RBI announced some clarifications that mitigate the
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ECBs by Corporates under Investigation
Hitherto, companies that are under investigation by law enforcement agencies such as the Directorate of Enforcement are not entitled to taken on external commercial borrowings (ECBs) under the automatic route, and are required to approach the Reserve Bank of India (RBI) for approval. Through a recent circular, the RBI has relaxed such position. Now, such
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Miscellaneous
1. Further Liberalization of ECB Policy Given the ailments afflicting the civil aviation sector in India, the Reserve Bank of India (RBI) has allowed external commercial borrowings (ECBs) in that sector even where the end-use of funds is for working capital requirements. This is permissible under the approval route, and is subject to several conditions
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Further Liberalisation of ECB Policy
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More Hurdles for LLPs
As we have previously noted on this Blog, the popularity of limited liability partnerships (LLPs) has not met with expectations since introduction of that business vehicle in April 2009. While the Government has taken certain steps to boost the utility of LLPs, such as by considering the possibility of foreign investment into LLPs discussed in
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Further Measures to Boost Infrastructure Financing
In continuation of previous measures, the Reserve Bank of India (RBI) has taken additional steps to enable financing in the infrastructure sector. First, the proposed introduction of credit default swaps on corporate bonds (discussed here) covers corporate bonds issued by Special Purpose Vehicles (SPV) of rated infrastructure companies “keeping in view the need for development
