ECB inflows to moderate on rising rates, depreciating rupee: Bank of Baroda

External Commercial Borrowings (ECBs) accounted for 36.8% of India's external debt as of the end of December 2021

The overseas fundraising through the external commercial borrowings (ECBs) by corporations in India will moderate in the coming months on monetary policy tightening and steady depreciation of the rupee, according to Bank of Baroda’s assessment.

ECBs have emerged as an important source of financing for companies including public sector undertakings. In fact, ECBs accounted for 36.8 per cent of India’s external debt as of the end of December 2021. In the year ended March 2022 (FY22), ECBs approvals had risen to $38.2 billion from $34.8 billion in FY21, RBI data showed.

This rise in the use of ECB route was