International Borrowing Reaches Highest Level in Five Years
In a significant boost for India’s private sector, manufacturing and finance companies have secured approval to raise a remarkable $11 billion through external commercial borrowings (ECBs) in March 2025. This influx marks the highest monthly ECB inflow in over five years, reflecting growing confidence in India’s economic landscape. The Reserve Bank of India (RBI) reported that approximately $8.3 billion of this amount was approved via the automatic route, while nearly $2.7 billion came through the approval route, underscoring the nation’s ability to attract foreign capital.
Key Recipients of ECB Approvals
Several notable companies emerged as major beneficiaries of the ECB approvals in March. Yuzhan Technology (India), a subsidiary of Taiwan’s Foxconn Group, received authorization to raise $220 million to support its working capital needs. Established in late 2023, Yuzhan specializes in the manufacturing of computer, electronic, and optical products. Additionally, JSW Steel was granted approval to raise $900 million to refinance an earlier ECB, while ONGC Videsh and MRPL each secured approvals for $450 million and $500 million, respectively, for similar refinancing purposes.
Power Finance Corporation also received the green light to raise $250 million for onlending, and IndianOil was approved for $400 million to refinance a previous ECB. Other companies that received ECB approvals include Tata Semiconductor, which secured $625 million for a new project, and the Nuclear Power Corporation of India, which was approved for $511 million. JSW Neo received $675 million for investment in an overseas joint venture, while Hero Fincorp and Nissan Renault Financial Services were approved for $250 million and $233 million, respectively, for onlending.
Annual ECB Trends and Insights
For the entire fiscal year, total ECB proposals reached an impressive $61.8 billion, marking a substantial increase from the $49 billion raised in FY24. Notably, nearly half of these approvals were attributed to financial services companies. The top ten recipients of ECB approvals for FY25 included major players such as Reliance Industries, Power Finance Corporation, and JSW Steel.
Reliance Industries, for instance, received approval for two loans: approximately $3 billion aimed at refinancing earlier ECBs and an additional $1 billion for local sourcing of capital goods. Both loans are set to mature between five to twelve years. Other significant approvals included ONGC Videsh, which was granted $800 million, and companies like Muthoot Finance, Shriram Finance, IIFL Finance, and Tata Capital, each receiving approvals for $750 million for onlending purposes.
Implications for India’s Economic Landscape
The surge in ECB approvals signals a robust outlook for India’s economic prospects, as companies increasingly seek to leverage foreign capital to fuel growth and expansion. The record inflow of $11 billion in March 2025 not only highlights the confidence of investors in India’s financial stability but also reflects the country’s strategic initiatives to enhance its manufacturing capabilities and attract global investments.
As the private sector continues to thrive, the implications of these approvals extend beyond immediate financial benefits. They indicate a broader trend of increasing foreign interest in India’s market, which could lead to enhanced job creation, technological advancements, and overall economic development. With the government and regulatory bodies fostering an environment conducive to investment, the future looks promising for both domestic and international stakeholders in India’s evolving economic landscape.
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