National Solar Energy Federation of India (NSEFI), a non-profit organisation, has written to the Prime Minister’s Office requesting to direct the Reserve Bank of India (RBI) to rationalise the new ECB framework suitably, excluding repayment of rupee loans from the negative list.
“NSEFI apprises you that till date, RBI allowed the external borrowing in the form of security bond/loan in U.S. dollars to replace the Indian rupee loans having tenure of 10 years or more given by domestic banks/financing institutions. As per this notification, erstwhile tracks I and II are merged as ‘foreign currency denominated ECB’ and track III and rupee denominated bonds framework are combined as ‘rupee denominated ECB’ to replace the current four-tiered structure.
“However, the existing permissible end use of repayment /refinancing of rupee loan availed under track-II of ECB has not been considered in the merged foreign currency ECB framework in any form,” NSEFI chairman Pranav Mehta wrote in the letter, adding that therefore, the repayment of rupee loan to domestic lenders by solar/wind project developers from ECB proceeds would not be possible.
“NSEFI requests your good offices to intervene in the matter and provide suitable direction/advice to the Reserve Bank of India to carve out a special category like erstwhile track-II with ECB having minimum average maturity period of five years and above within the new merged foreign currency ECB category to permit solar/wind project developers for repayment of their rupee loans to domestic lenders from ECB proceeds,” Mr. Mehta added.
Otherwise, such a new framework would jeopardise the large-scale development of wind and solar power projects in India, he wrote
NSEFI was founded in 2013 by solar energy industry leaders with a vision to promote solar energy.
