(a) the details of guidelines governing External Commercial Borrowings
(ECBs) for the purpose of developing Special Economic Zones (SEZs);
(b) whether the Government proposes to review External Commercial
Borrowing Guidelines;
(c) if so, the details thereof; and
(d) the provisions envisaged for approvals under automatic route?
MINISTER OF STATE FOR FINANCE(SHRI NAMO NARAIN MEENA)
(a) to (c): The ECB policy is regularly reviewed and modified by
the Government in consultation with Reserve Bank of India, keeping
in view the evolving macroeconomic condition, sectoral requirements
and investment demand. The policy was reviewed in June, 2009.
As per the extant ECB guidelines, units in the SEZ are permitted
to access ECBs for their own requirements. However, based on
review effective from June 30, 2009, SEZ developers have been
permitted to avail of ECB under the Approval route for providing
infrastructure facilities also, as defined in ECB policy, within
the SEZ. However, ECB shall not be permissible for development
of integrated township and commercial real estate within the SEZ.
The infrastructure facilities as defined in the extant ECB policy
include
(i) power,
(ii) telecommunication,
(iii) railways,
(iv)
road including bridges,
(v) sea port and airport
(vi) industrial
parks
(vii) urban infrastructure (water supply, sanitation and
sewage projects) and
(viii) mining, refining and exploration.
(d) ECB can be accessed under two routes. Viz.
(i) Automatic Route
as outlined in Section I(A) and
(ii) Approval Route as outlined in
Section I (B) of Master Circular dated July 1, 2009 on ECB issued by
RBI under FEMA. Under the Automatic Route, the eligible borrowers
may enter into loan agreement with recognized lender for raising ECB
complying with the amount, maturity, all-in-cost, and end use etc.
conditions in the ECB guidelines without prior approval of the
Reserve Bank. However, the borrowers are required to obtain a Loan
Registration Number (LRN) from the Reserve Bank before drawing down
the ECB. The procedure for obtaining LRN has been outlined in
Section II(i)(b) of Master Circular on ECB and Trade Credits issued
by RBI under FEMA.