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GlossaryITXWhat is ECB (External Commercial Borrowing)?
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What is ECB (External Commercial Borrowing)?

External Commercial Borrowing (ECB) is borrowing by an Indian entity from a recognised foreign lender, regulated by the RBI under FEMA.

Bare Law Reference: FEMA; RBI ECB framework.

Detailed Explanation

How it works

ECB is governed by limits on amount, end-use, minimum maturity and all-in cost, under the automatic or approval route, with reporting in Form ECB and monthly ECB-2 returns.

Frequently asked questions

What is an ECB?

Borrowing by an Indian entity from a recognised foreign lender, regulated by the RBI under FEMA.

What governs an ECB?

Limits on amount, end-use, maturity and all-in cost, with Form ECB and ECB-2 reporting.

This content is for general guidance only and does not constitute professional advice. Tax law changes frequently — verify the current position and consult a qualified Chartered Accountant before acting. Last reviewed: June 2026.

Key Takeaways

  • ECB is foreign borrowing by Indian entities.
  • Subject to RBI limits on end-use, maturity, cost.
  • Reported via Form ECB and ECB-2.
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