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of <h1>Credit enhancement by non-resident guarantors for INR bonds: eligibility expanded, minimum maturity reduced to three years, early redemption prohibited</h1> Credit enhancement by eligible non-resident entities is authorised for INR-denominated bonds/debentures issued domestically by all borrowers eligible to raise External Commercial Borrowings under the automatic route, and the minimum average maturity for such underlying debt is reduced from seven years to three years, with prepayment and call/put options prohibited for instruments having average maturity up to three years (operative effect: expands eligible guarantors and shortens permitted maturity while restricting early redemption rights). On invocation, where the guarantor discharges the liability and foreign-currency repayment to the non-resident is permissible, the applicable all-in-cost ceilings for the relevant maturity apply to the novated loan. The directive is effective immediately and subject to review.
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