BANKING AFFAIRS

Detailed explanation-1: -External commercial borrowings (ECBs) refers to the loans made by non-resident lenders in foreign currency to Indian borrowers. They are used widely in India to facilitate access to foreign money by Indian corporations and undertakings. It forms a part of capital account as it is a borrowed fund for business purpose.

Detailed explanation-2: -External Commercial Borrowing (ECB) External Commercial Borrowings are commercial loans raised by eligible resident entities from recognised non-resident entities to meet their capex expenditure, working capital requirements, etc.

Detailed explanation-3: -External Commercial Borrowings (ECB) refer to commercial loans [in the form of bank loans, buyers’ credit, suppliers’ credit, securitised instruments (e.g. floating rate notes and fixed rate bonds)] availed from non-resident lenders with minimum average maturity of 3 years.