Inflation woes, dull sentiment, Gujjar pressure, Oil price spiral, election reversal in Karnataka – woof…. enough to drive any Government mad. The current congress government is at least clearly lost on ideas. So what? There is always a roll-back option, like hiking the ECB limit for companies.
So now it is $50 million for ECBs against the earlier limit of $20 million, which had been mindlessly imposed last August. For (badly bruised) infrastructure sector companies the limit is up to $ 100 million under the approval route. Will it boost the sector, which requires $500 billion of investments? Hardly. But gives some breather for some projects that are nearing completion. For you, to buy top stocks on the cheap ;)
So now it is $50 million for ECBs against the earlier limit of $20 million, which had been mindlessly imposed last August. For (badly bruised) infrastructure sector companies the limit is up to $ 100 million under the approval route. Will it boost the sector, which requires $500 billion of investments? Hardly. But gives some breather for some projects that are nearing completion. For you, to buy top stocks on the cheap ;)
All in cost ceilings have also been generously revised. So much for levels of despair ;) Over six months LIBOR in respect of ECB for average maturity period between 3 – 5 year borrowings is now up to 200 bps, from 150 bps at present. For borrowings more than five years, the cost has been increased to 350 bps from 250 bps at present.
Other conditions - like the existing $500 million annual limit for companies has been left unchanged. So are the end-use of foreign currency expenditure for import of capital goods and overseas investments, average maturity period, prepayment, refinancing of existing ECB and reporting arrangements.
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Call it bad karma catching up with congress...
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