RBI in consultation with the Government of India liberalized some aspects of the ECB policy including policy on Rupee denominated bonds as indicated below:
(i) ECBs by companies in manufacturing sector:
As per the extant norms, ECB up to USD 50 million or its equivalent can be raised by eligible borrowers with minimum average maturity period of 3 years. It has been decided to allow eligible ECB borrowers who are into manufacturing sector to raise ECB up to USD 50 million or its equivalent with minimum average maturity period of 1 year.
(ii) Underwriting and market making by Indian banks for Rupee denominated bonds (RDB) issued overseas:
- Presently, Indian banks, subject to applicable prudential norms, can act as arranger and underwriter for RDBs issued overseas and in case of underwriting an issue, their holding cannot be more than 5 per cent of the issue size after 6 months of issue. It has now been decided topermit Indian banks to participate as arrangers/underwriters/market makers/traders in RDBs issued overseas subject to applicable prudential norms.
- All other provisions of the ECB policy shall remain unchanged. AD Category – I banks should bring the contents of this circular to the notice of their constituents and customers.
Click here for ECB Circular on ECB Policy Liberalisation dtd 19.09.2018