Which of the following statements on external commercial borrowings (ECBs) are correct?

These can be used for investment in stock market.

These are used to facilitate access to foreign money.

INR denominated ECB includes trade credits beyond three years.

Choose the correct answer using the codes given below:

Question

External commercial borrowings (ECBs) are loans in India made by non-resident lenders in foreign currency to Indian borrowers. They are used widely in India to facilitate access to foreign money by Indian corporations and PSUs (public sector undertakings).
ECBs include commercial bank loans, buyers\' credit, suppliers\' credit, securitized instruments such as floating rate notes and fixed rate bonds etc., credit from official export credit agencies and commercial borrowings from the private sector window of multilateral financial Institutions such as International Finance Corporation (Washington), ADB, AFIC, CDC, etc.
ECBs cannot be used for investment in stock market or speculation in real estate.
The DEA (Department of Economic Affairs), Ministry of Finance, Government of India along with Reserve Bank of India, monitors and regulates ECB guidelines and policies.
INR denominated ECB includes trade credits beyond three years, floating/ fixed-rate notes/ bonds/ debentures (other than fully and compulsorily convertible instruments), loans including bank loans, financial lease, and plain vanilla Rupee denominated bonds issued overseas.

GKToday Admin · Accepted Answer

Only 2 & 3

External commercial borrowings (ECBs) are loans in India made by non-resident lenders in foreign currency to Indian borrowers. They are used widely in India to facilitate access to foreign money by Indian corporations and PSUs (public sector undertakings).
ECBs include commercial bank loans, buyers\' credit, suppliers\' credit, securitized instruments such as floating rate notes and fixed rate bonds etc., credit from official export credit agencies and commercial borrowings from the private sector window of multilateral financial Institutions such as International Finance Corporation (Washington), ADB, AFIC, CDC, etc.
ECBs cannot be used for investment in stock market or speculation in real estate.
The DEA (Department of Economic Affairs), Ministry of Finance, Government of India along with Reserve Bank of India, monitors and regulates ECB guidelines and policies.
INR denominated ECB includes trade credits beyond three years, floating/ fixed-rate notes/ bonds/ debentures (other than fully and compulsorily convertible instruments), loans including bank loans, financial lease, and plain vanilla Rupee denominated bonds issued overseas.