In the process of revamping the External Commercial Borrowing Policy so as to foster the ease of doing business, Reserve Bank of India has further revised the ECB Policy vide notification dated 7th February, 2019 in order to relax the end use restrictions for resolution applicants under Corporate Insolvency Resolution Process.

In accordance to the provisions of ECB Policy, ECB proceeds shall not be utilized for repayment of domestic Rupee loans except when it has been availed from foreign equity holder(s). However, RBI here and now granted a relaxation to the resolution applicants under Corporate Insolvency Resolution Process as per Insolvency and Bankruptcy Code, 2016 and allowed them to utilize the ECB proceeds for repayment of Rupee term loans of the target company subject to a condition that the ECB has been raised from the recognized lenders except branches/ overseas subsidiaries of Indian banks. Further, the grant of said utilization of proceeds is under approval route.