Govt to raise interest rate cap on ECBs

The government is considering to raise the interest rate cap on external commercial borrowings (ECB) to ease difficulties faced by companies raising funds overseas.

“Funds have become expensive worldover. There is a need to change the (interest rate) spread on ECB,” a senior Finance Ministry official said.

A decision in this regard is expected soon, the official added. The move follows after the Ministry  received representations from the industry.

However, there will be no change in ECB policy in the near future. “The government thinks there is no need to change (ECB norms) now,” the official added.