51 firms raised $13.5 bn through ECB

Companies had raised funds worth $5,553.07 million,with each raising $100 million through ECB or FCCB.

As many as 51 companies,including Reliance Communications,Aircel and Sasan Power,raised about $13.5 billion through external commercial borrowing (ECB) for infrastructure projects in the last two financial years,Parliament was informed on Tuesday.

In 2009-10,22 companies had raised funds worth $5,553.07 million,with each raising $100 million or more,through ECB or FCCB (foreign currency convertible bonds) route,Minister of state for Finance Namo Narain Meena said in a written reply to the Rajya Sabha.

In the following year,29 companies had raised $100 million or more through such borrowings. Their foreign borrowings stood at $7,993.12 million. The minister was quoting from information provided by the Reserve Bank of India. Among others Reliance Communications raised $1,330 million,Sasan Power borrowed $486 million and Aircel $500 million for infrastructure projects. The minister further said that borrowers were required to inform about utilisation of the funds to the RBI on a monthly basis.

Contravention of the ECB guidelines could invite penal action under the Foreign Exchange Management Act (FEMA). ECB route provides domestic firms access to cheaper foreign funds.

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external commercial borrowing

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