By IANS,
New Delhi : The government Saturday eased its external commercial borrowing (ECB) norm, enabling firms in the service sector – hotels, hospitals and software companies – to borrow up to $100 million for import of capital goods.
The decision comes as a big solace to the borrowers in service sector, who are not currently eligible to avail ECB under the automatic route.
“It has been decided that henceforth borrowers in services sector, viz hotels, hospitals and software companies may avail ECB up to $100 million for import of capital goods under the approval route,” said an official communiqué issued Saturday.
“The amendment in ECB policy will come into force on the date of notification of regulations or directions issued by the Reserve Bank of India (RBI) in this regard under the Foreign Exchange Management Act, 1999,” the statement said.
The government reviews its ECB policy regularly in consultation with the Reserve Bank of India to keep it in tune with the evolving macro-economic situation, changing market conditions, sectoral requirements, the external sector and its experience.
On May 28, the government had amended the ECB policy to enable borrowers in infrastructure sector to avail ECB up to $100 million for rupee expenditure for permissible end-uses under the approval route.