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India Inc raises $1.6 bn via ECBs in Nov 2011

Business Standard:  January 05, 2012

Mumbai: India Inc raised raised $ 1.6 billion via external commercial borrowings (ECBs) in November, 2011. According to the Reserve Bank of India (RBI), the ECB borrowing dipped by $900 million as against $2.5 billion in October 2011.

Under the automatic route, 78 companies raised $ 1.3 billion. ONGC Mangalore Petrochem raised $250 million and Tata Teleservices borrowed $200 million for financing of new project and import of capital goods respectively. Infrastructure Development Finance Corporation (IDFC) also raised $100 million for onward lending to infrastructure projects via ECB.

Currently, the government allows the companies to raise up to $750 million under the automatic route in a year. Beyond $750 million, approval by the RBI is required.

A total of $253 million was raised under the approval route that requires case-by-case nod by the regulator. Under the approval route, Dredging Corporation of India raised $253 million for development of ports, while The India Hotels Company borrowed $95 million. No foreign currency convertible bonds (FCCB) were issued.

The ECB borrowings have slowed over the past few months as the global economic outlook is weak and firms are following a wait and watch policy with respect to their investment activities, economists said.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

x IBEF : India Brand Equity Foundation