Firms can refinance foreign debt without RBI approval

The Reserve Bank of India said on Monday companies can refinance their overseas borrowing without seeking any specific approval from the bank.

The ruling enables companies with outstanding debt to raise funds via fresh external commercial borrowings and foreign currency convertible bonds (FCCBs).

Restructuring of FCCBs involving change in the existing conversion price is not permissible, the Reserve Bank of India said.

"Keeping in view the need to provide a window to facilitate refinancing of FCCBs by the Indian companies who may be facing difficulty in meeting the redemption obligations, the Reserve Bank, in consultation with the Government of India, has decided to allow the Indian companies to refinance/ restructure the outstanding FCCBs issued by them," the central bank said.