Under the Foreign Exchange Management (Borrowing and

Solution

The Reserve Bank of India notified the Foreign Exchange Management (Borrowing and Lending) (First Amendment) Regulations, 2026 to rationalise and simplify the External Commercial Borrowing (ECB) framework. ECB refers to commercial loans raised by Indian entities from recognised foreign lenders in foreign currency. The reforms aim to make the framework more flexible and efficient by expanding eligible borrowers and recognised lenders, rationalising borrowing limits and maturity conditions, removing the all-in-cost cap, and simplifying reporting requirements. These changes were finalised after reviewing stakeholder feedback on the draft framework released on 3 October 2025. The amendments will apply prospectively, meaning they will affect future borrowings rather than existing ECB arrangements.