Approval Route

a) Eligible Borrowers
b) Recognized lenders
c) Amount and Maturity
d) All-In-Cost Ceiling
e) End Use
f) End Use Not Permited
g) Guarantees
h) Security
i) Parking Of ECB
j) Prepayment
k) Refinancing Of an Existing ECB
l) Debt Servicing
m) Procedure
n) Empowered Committee
 Eligible Borrowers
Borrow
ers
SEZ
developers

Multi Stage FIs dealing

exclusively with
Co-operative Infrastructure or
Society Export Finance

Banks & FIs

Special purpose (participated in textile
vehicles as /steel sector
restructuring
notified by RBI packages)

FCCBs by NBFCs involved in

financing of
housing infrastructu-re
finance Co. sector
 Recognized Lenders

International ●

●
International banks
International capital markets

ly recognized Multi-lateral FIs

●

●
Export Credit Agencies
●
Foreign Collaborators

sources Suppliers of Equipment

●

Foreign ●
where the minimum paid up
Equity equity held directly by the foreign
equity lender is 25 per cent

Holders
 Amount and
Maturity All-in-cost Ceilings

 Corporate can avail of ECB of an  includes rate of interest other

additional amount of USD 250
million with average maturity of
more than 10 years.
 Other ECB criteria need to be
complied with.
 Prepayment and call/put
options, however, would not be
permissible for such ECB up to a
period of 10 years.
fees and expenses in foreign
currency except commitment
fee, pre-payment fee and fees
payable in Indian Rupees
 the payment of withholding tax
in Indian Rupees is excluded for
calculating the all-in-cost.
 End-Use
on-lending or investment in capital market or acquiring a company

real estate

working capital, general corporate purpose and repayment of existing Rupee loans.

Not-
Permitted
Permitted
 Guarantee

 Issuance of guarantee, standby L/c, LoU or letter of comfort by

banks, FIs and NBFCs relating to ECB is not permitted.

Exception
SME
Indian textile industry
 Security
• Left to the borrower

• Powers have been delegated to AD to issue necessary 'no

objection’.
 Parking of ECBs Proceeds

 ECB proceeds parked overseas can be invested in the following liquid

assets

a) deposits or Certificate of Deposit or other products offered by banks

b) Treasury bills and other monetary instruments of one year maturity,

c) deposits with overseas branches / subsidiaries of Indian banks abroad.

 ECB funds may also be remitted to India for credit to the borrowers’
Rupee accounts with AD in India.
 Pre-Payment

Upto USD 500 million may be allowed by the

AD without prior approval of RBI subject to
compliance with the stipulated minimum
average maturity period as applicable to the
loan.
Refinancing of an Debt Servicing
existing ECB
The designated AD has
general permission to
By raising a fresh ECB make remittances of
subject to the installments of principal,
condition that the interest and other charges
fresh ECB is raised at a in conformity with ECB
guidelines issued by
lower all-in-cost and
Government / Reserve
the outstanding Bank from time to time.
maturity of the original
ECB is maintained.
 Procedure Empowered
Applicants are required to Committee
submit an application in form
ECB through designated AD
bank to

The Chief General Manager-in-

charge, Foreign Exchange
Department, Reserve Bank of Reserve Bank has set up
India, Central Office, External an Empowered
Commercial Borrowings Committee to consider
Division, Mumbai – 400 001,
proposals coming under
along with necessary
the Approval Route
documents.