GUIDELINES ON POLICIES AND PROCEDURES FOR EXTERNAL COMMERCIAL BORROWINGS FOR 1997-98

END-USE REQUIREMENTS

1. External commercial loans are to be utilised for import of capital goods and services (on FOB or CIF basis). However, in the case of projects in the following infrastructure areas, ECB can be utilised for rupee expenditure:-
   1. Power
   2. Telecommunications(Licence fee payments would be an approved use of ECB).
   3. Railways
   4. Roads (including bridges)
   5. Ports
   6. Industrial Parks; and
   7. Urban infrastructure(water supply, sanitation and sewerage projects as defined in Section 80 IA of Income Tax Act, 1961).
2. Corporate borrowers will be permitted to raise ECB to acquire ships/vessels from Indian shipyards.
3. ECB proceeds may also be utilised for project- related rupee expenditure as outlined in paras 7 to 11 above. However, under no circumstances, ECB proceeds will be utilised for-
   1. Investment in stock market; and
   2. Speculation in real estate.

Guidelines on Policies and Procedures for External Commercial Borrowings 1997-98

[ECB Policy] [Average Maturities for ECB] [USD 3 Million Scheme][Exporters/Foreign Exchange Earners][ Infrastructure Projects][Long-Term Borrowers][On Lendings by DFIs and Other Financial Intermediaries][End-Use Requirements][Proceeds from Bonds , FRNs & Syndicated Loan][ECB Entitlement for New Projects][Interest rate for Project Financing][Other Term and Conditions][Security][Exemption from Withholdings Tax][Approval under FERA][Short-Term Loan from RBI][Validity of Approval][Pre-Payment of ECB][Refinancing the Existing Foreign Currency Loan][Liability Management][Procedure for Seeking ecb Approval][Review][Hedging of Loan Exposures][Format for providing information to Department of Economic Affairs, Ministry of Finance, for seeking ECB Approval]