India Inc raised $3.4 bn in December overseas

• Indian companies raised over USD 3.41 billion overseas in December through External Commercial Borrowings (ECBs) and Foreign Currency Convertible Bonds (FCCBs)
• Corporates, registered under the Companies Act, 1956, can access ECBs up to USD 500 million in a financial year, under the automatic route. The ECB, which is not covered by the automatic route, is considered under the approval route on a case-by-case basis by RBI.
• ECBs are used as an additional source of funding by Indian corporates to augment resources available domestically.
• Foreign Currency Convertible Bonds (FCCBs) are also governed by norms similar to ECBs.

ECB 

• ECB (External Commercial Borrowings) is an instrument used in India to facilitate the access to foreign money by Indian corporations and PSUs (Public Sector Undertakings).
• ECBs include commercial bank loans, buyers' credit, suppliers' credit, securitised instruments such as Floating Rate Notes and Fixed Rate Bonds etc., credit from official export credit agenciesand commercial borrowings from the private sector window of Multilateral Financial Institutions such as International Finance Corporation (Washington), ADB, AFIC, CDC, etc. 
• ECBs cannot be used for investment in stock market or speculation in real estate. The DEA(Department of Economic Affairs), Ministry of Finance, Government of India along with Reserve Bank of India, monitors and regulates ECB guidelines and policies. 
• For infrastructure and greenfield projects, funding up to 50% (through ECB) is allowed. In telecom sector too, up to 50% funding through ECBs is allowed.

FCCB ( Foreign Currency Convertible Bond)

A type of convertible bond issued in a currency different than the issuer's domestic currency. In other words, the money being raised by the issuing company is in the form of a foreign currency. A convertible bond is a mix between a debt and equity instrument. It acts like a bond by making regular coupon and principal payments, but these bonds also give the bondholder the option to convert the bond into stock.

These types of bonds are attractive to both investors and issuers. The investors receive the safety of guaranteed payments on the bond and are also able to take advantage of any large price appreciation in the company's stock. (Bondholders take advantage of this appreciation by means warrants attached to the bonds, which are activated when the price of the stock reaches a certain point.) Due to the equity side of the bond, which adds value, the coupon payments on the bond are lower for the company, thereby reducing its debt-financing costs.