The Reserve Bank of India has come up with a regulation
governing all types of lending and borrowing transactions between a
resident in India and a non-resident Indian (NRI). The transaction
can either be in Indian Rupees or foreign currency. The RBI
notified the Foreign Exchange Management (Borrowing and Lending)
Regulations, 2018 on December 17, 2018, replacing the previous
regulations. The existing framework on the External Commercial
Borrowing (ECB) was revised on January 16, 2019. The new policy was
introduced with immediate effect.
The following are the key features that have been changed as per
the new policy-
- Change in structure
- The scope of eligible borrowers
- Rules relating to recognized lenders
