RBI extends ECB refinancing window for telecom, aviation sectors

The Reserve Bank of India (RBI) extended the time limit allowed for external commercial borrowings to refinance rupee loans in the infrastructure companies in sectors like telecom, civil aviation etc to 31 March 2014.

As per the extant policy, the payment for spectrum allocation may initially be met out of the rupee resources by the successful bidders, to be refinanced with a long term ECB, under the approval route, subject to the condition that ECB should be raised within 12 months from the date of payment of the final installment to the government.

RBI has now decided that the ECB window for financing 3G spectrum rupee loans that are still outstanding in the telecom operator's books of accounts may be open up to 31 March 2014.

In the case of the ECB window for working capital for civil aviation sector, it has now been decided that the scheme of availing of ECB for working capital will continue till 31 December 2013.

Indian companies in the infrastructure sector are also allowed to avail of ECB in the Chinese currency Renminbi (RMB) under approval route subject to an annual cap of $1 billion pending further review. It has now been decided that since the facility of ECB in Renminbi had remained unused so far, the scheme of ECB in Renminbi will be discontinued with immediate effect.

All other aspects of the ECB policy remain unchanged, RBI said in three notifications released today.