Chennai, May 7 625 companies have borrowed nearly $31 billion (or about the equivalent of Rs 1,20,000 crore) through external commercial borrowings (ECBs) during the last fiscal (2007-08), according to information released by the Reserve Bank of India. In the previous fiscal (2006-07), 921 companies had borrowed $25 billion abroad.
Indian companies have steadily increased their borrowing overseas over the past four years. In the last fiscal, their external borrowings appear to have been a substantial chunk of their overall borrowings (about 40 per cent).
According to data provided by the RBI, the Indian industry (small, medium and large) accounted for about Rs 1,67,000 crore of borrowings from banks last fiscal.
There was a drop in the number of companies borrowing abroad in the middle of the last fiscal.
Bankers were just beginning to talk of declining credit offtake in the local market then. And given a situation that saw more dollar inflows (portfolio and foreign direct investment), it was thought that the RBI was trying to nudge companies to borrow locally. Companies have since resumed overseas borrowing, leading to a 25 per cent increase for the full year.
About 55 companies borrowed nearly $4.47 billion in March alone.
Reliance Petroleum, Adani Power and Essar Oil were among the biggest borrowers, each raising $500 million in that month.
SOURCE:
The Hindu Business Line
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