ECB norms eased for SEZ realty

The government allowed developers of special economic zones (SEZ) to raise debt from overseas markets for developing infrastructure facilities within their zones. HT Correspondent reports.

The government on Wednesday allowed developers of special economic zones (SEZ) to raise debt from overseas markets for developing infrastructure facilities within their zones.

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“It has been decided to allow SEZ developers to avail of ECB, under the Approval route, for providing infrastructure facilities, as defined in the extant ECB policy, within the SEZ. However, ECB will not be permissible for development of integrated township and commercial real estate within the SEZ,” a statement from the finance ministry said.

Special economic zone developers, however, would be allowed to raise ECB for building integrated townships or commercial real estate within the zone.

They can raise loans overseas after taking approval for establishing infrastructure facilities including power, telecommunication, railways, roads including bridges, ports, industrial parks, urban infrastructure (water supply, sanitation and sewage projects) and mining, refining and exploration, as laid down in the ECB policy.

Changes have also been announced in ECB norms for non-banking finance companies (NBFCs).

Under current norms, NBFCs that are exclusively involved in infrastructure financing are permitted to avail of ECBs from multilateral financial institutions for on-lending to borrowers in the infrastructure sector under certain conditions. Some of these conditions have been eliminated.