RESERVE BANK OF INDIA
Foreign Exchange Department
Central Office
Mumbai - 400 001
A. P. (DIR Series) Circular No. 112
April 20, 2012
To
All Category-I Authorised Dealer Banks
Madam / Sir,
External Commercial Borrowings (ECB) Policy –
Refinancing/Rescheduling of ECB
Attention of Authorized Dealer Category-I (AD Category-I) banks is invited to
the Foreign Exchange Management (Borrowing or Lending in Foreign Exchange)
Regulations, 2000, notified vide Notification No. FEMA 3/2000-RB dated May 3,
2000 and A.P. (DIR Series) Circular No. 5 dated August 1, 2005, as amended from
time to time.
- As per the extant guidelines, existing ECB may be refinanced by raising a
fresh ECB subject to the condition that the fresh ECB is raised at a lower
all-in-cost.
- On a review, it has been decided that the borrowers desirous of refinancing
an existing ECB can raise fresh ECB at a higher all-in-cost/reschedule an
existing ECB at a higher all-in-cost under the approval route subject to the
condition that the enhanced all-in-cost does not exceed the all-in-cost ceiling
prescribed as per the extant guidelines.
- The modifications to the ECB policy will come into force with immediate
effect and will be subject to review. All other aspects of ECB policy remain
unchanged.
- Necessary amendments to the Foreign Exchange Management (Borrowing or Lending
in Foreign Exchange) Regulations, 2000 dated May 3, 2000 are being issued
separately wherever necessary.
- AD Category - I banks may bring the contents of this circular to the notice
of their constituents and customers concerned.
- The directions contained in this circular have been issued under sections
10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and
are without prejudice to permissions / approvals, if any, required under any
other law.
Yours faithfully,
(Rashmi Fauzdar)
Chief General Manager
RBI/2011-12/520