Business Daily from THE HINDU group of publications
Monday, Dec 01, 2008
ePaper | Mobile/PDA Version | Audio | Blogs
Business Daily from THE HINDU group of publications Monday, Dec 01, 2008 ePaper | Mobile/PDA Version | Audio | Blogs |
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Mentor
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Overseas Borrowings Columns - For the Asking GDR and ECB How come the government’s GDR (Global Depository Receipt) regulations have remained the same whereas the ECB (External Commercial Borrowing) guidelines are tinkered with every now and then? Ram Prakash Pasricha, Chandigarh Yes it is true that the GDR norms have, by and large, remained stable. The ECB norms, on the other hand, cannot remain stable because while GDR brings in equity into the country, ECB brings in debts, which carry interest. GDR adds to the foreign exchange reserves of the country on a permanent basis. ECBs have to be repaid. The government is at its wits’ end to attract greater foreign exchange flows into the country in the wake of massive pullout by the FIIs resulting in steep depletion in the forex reserves of the country. Therefore, it has allowed the $500 million automatic route for rupee payments across the board besides liberally easing the interest restrictions. The ECB norms simply cannot remain static because interest rates are volatile. S. MURLIDHARAN More Stories on : Overseas Borrowings | For the Asking
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