RBI Seeks to Amend External Commercial Borrowing (ECB) Regulations October 2025

• Objective: Modify ECB regulations under FEMA (Borrowing & Lending) to tie borrowing limits to financial strength of borrower.

Eligibility:

• Indian residents (other than individuals) established under Central/State law can borrow ECB subject to relevant laws.
• Restructuring/insolvency borrowers can borrow ECB if it is sanctioned in the plan.

Lenders & Currency:

• ECB can be borrowed from non-resident entities or IFSC branches governed by RBI.
• Borrowing permitted in foreign currency or INR; currency conversion permissible.

Borrowing Limits & Maturity:

• ECB up to the higher of USD 1 billion or 300% of total outstanding borrowing (external + domestic) of gross net worth.
• Minimum average maturity period: 3 years.
• Manufacturing sector borrowers: MAMP 1–3 years, with a limit of USD 50 million outstanding.

Significance: Enables regulated, flexible foreign borrowing while ensuring consistency with borrower capacity.