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November 2013

A. P. (DIR Series) Circular No. 59 dated 30th September, 2013

By Gaurang Gandhi, Chartered Accountant
Reading Time 1 mins
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External Commercial Borrowings (ECB) Policy – Refinancing/Rescheduling of ECB

Presently, borrowers could refinance under the Approval Route, upto 30th September, 2013, an existing ECB by raising fresh ECB at a higher all-in-cost /reschedule an existing ECB at a higher all-in-cost. However, the enhanced all-in-cost must not exceed the current all-in-cost ceiling.

This circular states that: –

a. With effect from 1st October, 2013, borrowers cannot refinance an existing ECB by raising fresh ECB at a higher all-in-cost/reschedule an existing ECB.

b. Borrowers can refinance their existing ECB by raising fresh ECB at lower all-in-cost, provided that the outstanding maturity of the original ECB is either maintained or extended, either under the automatic route and approval route as the case may be.

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