The government on Friday further liberalised external commercial borrowing policy by allowing non-banking financial companies (NBFCs) and housing finance companies (HFCs) to tap the overseas markets.Giving details of the new ECB guidelines, an official press release said NBFCs would now be permitted to borrow from abroad from multi-lateral and regional financial institutions, official export agencies and foreign banks for import of infrastructure equipment.Such borrowings for imports will have to be leasing for infrastucture projects with five-year average maturity and they will be subject to the Reserve Bank of India’s approval, it said.The housing finance companies will be permitted to issue foreign currency convertible bonds subject to fulfilling the criteria to be notified by the banking regulator.The release also said pre-payment of EBCs would now be allowed up to $200 million without prior approval of RBI, subject to minimum average maturity of five years. Earlier, pre-payment was allowed up to $100 million.
