RBI extends ECB borrowing window for airlines till March 2016

Mumbai: The Reserve Bank today extended the deadline for aviation sector to raise funds through external commercial borrowings (ECBs) route by a year till March, a move aimed at providing relief to the cash-crunched sector.

“In a review, it has been decided that…scheme of raising ECB for working capital for Civil Aviation Sector will continue till March 31, 2016,” the central bank said through a notification.

As per the earlier guidelines, the scheme was valid till March 2015.

The overall ECB ceiling for the entire civil aviation sector would be $1 billion and the maximum permissible ECB that can be availed by an individual airline company will be $300 million, it said.

This limit can be utilised for working capital and also refinancing of the outstanding working capital rupee loan availed from the domestic banking system.

In another notification, the RBI said the scheme of raising ECB for low-cost affordable housing projects will continue for the financial year 2015-16.

Developers and builders having a minimum of three years experience in undertaking residential projects with a good track record in terms of quality and delivery can avail ECB.

Housing Finance Companies (HFCs) and National Housing Bank (NHB) can also avail ECB for financing prospective owners of low cost affordable housing units.

PTI