External Commercial Borrowings (ECB) - Repayment of Rupee loans
RBI has decided to allow Indian companies to avail of ECBs for repayment of Rupee loan(s) availed of from the domestic banking system and / or for fresh Rupee capital expenditure, under the approval route , subject to them satisfying the following conditions:-
i. Only companies in the manufacturing and infrastructure sector will be eligible to avail of such ECBs;
ii. Such companies shall be a consistent foreign exchange earner during the past three financial years;
iii. Such companies are not in the default list/caution list of the Reserve Bank of India; and
iv. Such ECBs shall only be utilized for repayment of the Rupee loan(s) availed of for 'capital expenditure' incurred earlier and are still outstanding in the books of the domestic banking system and / or for fresh Rupee capital expenditure.
This facility will come into with immediate effect and is subject to review at an appropriate time depending upon evolving macroeconomic conditions and other relevant factors.
A P (DIR Series) CIRCULAR No. 134/RBI ; Dated: June 25, 2012