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TMI BlogExternal Commercial Borrowings (ECB) from the foreign equity holdersX X X X Extracts X X X X X X X X Extracts X X X X ..... gn Exchange Management (Borrowing or lending in foreign exchange) Regulations, 2000, notified vide Notification No. FEMA 3/2000-RB dated May 3, 2000, amended from time to time and the A.P. (DIR Series) Circular No. 5 dated August 1, 2005, amended from time to time relating to the External Commercial Borrowings (ECB). 2. As per the extant ECB policy, a 'foreign equity holder' to be eligible as 're ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered in working out this ratio; (ii) The paid-up capital contributed by the foreign equity holder is considered under the extant guidelines for the purpose of calculation of equity for ECBs of or beyond USD 5 million from direct foreign equity holders. Henceforth, besides the paid-up capital, free reserves (including the share premium received in foreign currency) as per the latest audited ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er:- (i) Service sector units, in addition to those in hotels, hospitals and software, could also be considered as eligible borrowers if the loan is obtained from foreign equity holders. This would facilitate borrowing by training institutions, R &D, miscellaneous service companies, etc; (ii) ECB from indirect equity holders may be considered provided the indirect equity holding by the lender in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts shall remain unchanged. 7. AD Category - I banks may bring the contents of this circular to the notice of their constituents and customers. 8. The directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law. Yours faith ..... X X X X Extracts X X X X X X X X Extracts X X X X
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