Indian firms raise $1.5 B overseas in September

Indian firms raise $1.5 B overseas in September

By siliconindia staff writer   |   Wednesday, 03 November 2004, 08:00 Hrs
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MUMBAI: Indian companies have raised over $1.5 billion through overseas borrowings in September, up sharply from $886 million in August, according to data provided by the Reserve Bank of India.
Foreign borrowings by local companies have been on the rise and are expected to double this year to $5 billion as business investment picks up in the rapidly growing economy. That compares with about $2.5 billion in calendar year 2003.

Asia's fourth-largest economy is expected to grow by at least six per cent in the year ending March 2005.

Of the total September borrowings, just $2 million came through the approval route, while the rest was under the automatic route, according to RBI's monthly report.

The maturities of the borrowings ranged between one to 12 years. Funds were to be used for modernisation and expansion, for importing capital goods, refinancing old loans and to meet working capital needs.

Reliance group, India's largest conglomerate, was the largest borrower, with $212 million raised by petrochemicals giant Reliance Industries and $600 million by mobile phone services firm Reliance Infocomm Ltd, the data showed.

Last week, the central bank raised its repo rate for the first time in four years, but economists and business executives say the increase may not be substantial enough to dent investment, which is picking up after more than half a decade.

State-run Indian Oil Corp is expected to launch a $150 million syndicated loan later this month to fund oil imports and capital expansion, while Indian Railways Finance Corporation is in the market for a $100 million five-year loan.

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