| In order to encourage overseas funding, RBI today proposed to allow domestic companies to borrow money from pension funds, sovereign wealth funds (SWFs) and insurance funds as part of the ECBs. The draft framework on External Commercial Borrowings (ECBs), however, proposed to lower the all-in cost borrowing by 0.50 per cent to ensure that the funds are borrowed from abroad at a reasonable interest rate.
The modification in the ECB guidelines on which RBI has invited comments till October 1 are aimed at replacing the ECB policy with a more rational and liberal framework, keeping in view the evolving domestic as well as global macroeconomic and financial conditions, challenges faced in external sector management and the experience gained so far, the draft guidelines added...............................................Full Article: Source
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