External Commercial Lending authorised for resident lenders to fund overseas investee entities under prescribed foreign exchange conditions.

Schedule III permits specified resident lenders to provide foreign exchange loans abroad. ADs may extend External Commercial Lending to foreign entities in which an Indian entity has made overseas direct investment in accordance with applicable transfer/issue of foreign security regulations. Foreign branches of Indian banks may lend in the normal course of banking business. Eligible entities that have made direct investments abroad may lend to their investee entities under the same investment regulations. Residents may lend from EEFC accounts for trade purposes subject to RBI and Government terms. Indian companies may grant foreign exchange personal loans to overseas branch employees under staff welfare or loan rules.

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