Changes to the External Commercial Borrowing Regime – Impact on International Debt Funds

The external commercial borrowing (“ECB”) regime is one of the central pillars of India’s exchange control regime and it tightly regulates loans between international lenders and Indian borrowers. Historically, a number of these requirements presented difficulties for international lenders. On 16 January 2019, the Reserve Bank of India (“RBI”) announced certain changes to the ECB regime. The impact of these changes on international debt funds and broker-dealers is summarised below.