According to the data released by Reserve Bank of India, while $763 million was raised through the automatic route, $194 million was mopped up under the approval route. Approval route requires a corporate to take the permission of the RBI before tapping the external loan market.
Of the total 52 proposals, only three corporates preferred to raise funds through foreign currency convertible bonds through the automatic route. These are Gujarat NRE Coke, Monnet Ispat, and LML.
While Reliance Industries raised $350 million ECB for modernisation under the automatic route for five years and three months, Indian Railway Finance Corporation tapped the ECB market to raise $123 million for rupee expenditure for a period of three years and eight months.
Clarification has been sought from four corporate regarding the end use of the funds as they have mentioned project and working capital as the purpose of raising funds.
One of these corporate raised funds for one year 11 months. Maturity of the funds raised ranged from one year 11 months to 11 years. Other major corporates included Vedanta alumina, and IDBI.
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