India:
Restriction On Indian Companies To Refinance/ Repay The Existing Rupee Loan
17 July 2014
S&A Law Offices
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In terms of the extant External Commercial Borrowings (ECB)
Policy eligible Indian companies were permitted to refinance /
repay the Rupee loans, raised by them from the domestic banking
system, by raising ECB from recognised lenders, subject to
conditions.
However, as per the circular dated 09.05.2014, RBI has decided
that eligible Indian companies will not be permitted to raise ECB
from overseas branches/ subsidiaries of Indian banks for the
purpose of refinance / repayment of the Rupee loans raised from the
domestic banking system in respect of Scheme of takeout financing,
Repayment of existing Rupee loans for companies in infrastructure
sector, Spectrum allocation, and Repayment of Rupee loans.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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