RBI Liberalizes ECB guidelines for Infrastructure Sector
THE existing ECB policy has been reviewed by RBI in consultation with the Government of India and it has been decided to allow Indian companies which are in the infrastructure sector, to utilise 25 per cent of the fresh ECB raised by the corporate towards refinancing of the Rupee loan/s availed by them from the domestic banking system, under the approval route, subject to the following conditions:-
(i) at least 75 per cent of the fresh ECB proposed to be raised should be utilised for capital expenditure towards a 'new infrastructure' project(s), where “infrastructure” is as defined in terms of the extant guidelines on ECB.
(ii) in respect of remaining 25 per cent, the refinance shall only be utilized for repayment of the Rupee loan availed of for 'capital expenditure' of earlier completed infrastructure project(s); and
(iii) the refinance shall be utilized only for the Rupee loans which are outstanding in the books of the financing bank concerned.
A P (DIR Series) Circular No. 25/RBI., Dated: September 23, 2011