Mumbai, May 7:The Reserve Bank of India (RBI), the apex bank has asked borrowers of external commercial borrowings (ECB) to provide bifurcation of the utilization of the ECB proceeds towards foreign currency and Rupee expenditure at the time of availing Loan Registration Number (LRN) from it.

As per the extant guidelines, ECB proceeds can be utilized for permissible foreign currency expenditure and Rupee expenditure. 

Now it has been reviewed and according it, RBI has decided that at the time of availing Loan Registration Number (LRN) from the Reserve Bank, borrowers should provide bifurcation of the utilization of the ECB proceeds towards foreign currency and Rupee expenditure in Form-83. 

The primary responsibility to ensure that the ECB proceeds meant for Rupee expenditure in India are repatriated to India for credit to their Rupee accounts with AD Category- I banks in India as per the extent guidelines. 

The borrower concerned and any contravention of the ECB guidelines will be viewed seriously and will invite penal action under the Foreign Exchange Management Act (FEMA), 1999.

The designated AD bank is also required to ensure that the ECB proceeds meant for Rupee expenditure are repatriated to India immediately after drawdown. 

The modifications to the ECB policy will come into force with immediate effect and subject to review. All other aspects of the ECB policy shall remain unchanged. 

RBI has asked AD Category - I banks to bring the contents of this circular to the notice of their constituents and customers.