The Reserve Bank today relaxed norms to help Indian corporates to raise funds in rupees from overseas lenders.
To facilitate external commercial borrowing (ECB) in rupees, RBI said off-shore lenders may enter into swap transactions with their overseas bank which in turn will enter into a back-to-back swap transaction with a bank in India.
Earlier, a non-resident ECB lender was allowed to extend loans in rupees provided the lender mobilises rupees through a swap undertaken with a bank in India.
For the purpose of executing swaps for ECBs denominated in rupees, the ECB lender, "if it desires, may set up a representative office in India," it added.
Also, the continuation of the swap will be subject to the existence of the underlying ECB at all times.
The RBI further said a KYC certification on the end client should also be taken by the bank in India as a one-time document from the overseas bank.
Meanwhile, speaking at an event in New Delhi, RBI Deputy Gov...
