Money & Banking
RBI permits ECB route to infrastructure companies

RBI has permitted infrastructure companies to tap the external commercial borrowings, or ECB route, to enable them to get much needed funds to kickstart stalled projects

In an effort to boost the otherwise stalled infrastructure sector and get projects off the ground, the Reserve Bank of India (RBI) has decided to permit infrastructure companies to tap the external commercial borrowings (ECB) route to fund infrastructure projects.

RBI in its circular dated 3rd December said, “In order to strengthen the flow of resources to infrastructure sector, it has been decided to permit holding companies & core investment companies (CICs) coming under the regulatory framework of the RBI to raise ECB under the automatic route or approval route for project use in Special Purpose Vehicles (SPVs).”

However, this is subject to specific terms and conditions as listed below:

  1. The business activity of the SPV should be in the infrastructure sector only, as per ECB guidelines.
  2. An infrastructure project is required to be implemented by the SPV established solely for the purpose of carrying out the infrastructure project.
  3. The ECB proceeds are utilised either for fresh capital expenditure (capex) or for refinancing of existing Rupee loans (under the approval route) availed of from the domestic banking system for capex as per the extant norms on refinancing.
  4. The ECB for SPV can be raised up to three years after the commercial operations date of the SPV or infrastructure project.
  5. The SPV (of an infrastructure project) should give an undertaking that, no other method of funding, such as, trade credit (if for import of capital goods), etc, will be utilised for that portion of fresh capital expenditure financed through ECB proceeds.
  6. The ECB proceeds should be kept in a separate escrow account as per the extant guidelines on parking of ECB proceeds pending utilisation for permissible end-uses and use of such proceeds should be strictly monitored by the ADs for permissible uses.
  7. In case of Holding Companies that come under the Core Investment Company (CIC) regulatory framework of the Reserve Bank, the additional terms and conditions for raising ECB for project use in SPVs will be as under:
    1. The ECB availed should be within the ceiling of leverage stipulated for CICs, their outside liabilities including ECB cannot be more than 2.5 times of their adjusted net worth as on the date of the last audited balance sheet.
    2. In case of CICs with asset size below Rs100 crore, the ECB availed of should be on fully hedged basis.

RBI said that an earlier stipulation that maximum 25 % of ECB raised by the infrastructure companies can be utilised for refinancing of the rupee loans availed from the domestic banking system (40% in case of power sector) would remain unchanged.



sujit ghosh

3 years ago

I'd like to have more information on RBI permitted list of infrastructure projects to raise funds through the ECB route.

Are Indians being used as guinea pigs of biometric technology companies? -Part 14

Biometric profiling for electronic monitoring is used across the world as a punitive tool for criminals. The threat of exclusion in absence of biometric-based Aadhaar on decrees and sanctions is unconstitutional as it would snatch the right to life and livelihood of all Indians

For creating a biometric profile of Indians, the National Identification Authority of India Bill, 2013 which was re-approved by the Union Cabinet on 8 October 2013 is listed for re-introduction in the Lok Sabha in the winter session for consideration and passing. Biometric profile is akin to a prisoner identification number although it is assigned by inheritance, not by the government.

On 19 November 2013, while inaugurating Bhartiya Mahila Bank meant for providing financial services to women in general and women self-help groups in particular in Mumbai, Sonia Gandhi, president of Indian National Congress said, “I believe that the use of Aadhaar has the potential to revolutionise the relationship of the vast majority of our people with our financial systems through the delivery of subsidy, welfare and cash payments. Through direct benefits transfer (DBT), Aadhaar will eliminate middlemen and reduce corruption on a large scale. But for this to happen banks have to come on board quickly.” This statement appears to be in contempt towards Supreme Court’s order of September 2013 because linking of direct benefits transfer with Aadhaar makes the latter mandatory which has been prohibited by the court.

Sonia Gandhi’s endorsement of biometric technology based Aadhaar for delivery of subsidy, welfare and cash payments through DBT has been rejected by the Supreme Court by its order of 23 September 2013 which was reiterated on 26 November 2013. Andhra Pradesh High Court and Punjab & Haryana High Court have also questioned its legality. In a significant development West Bengal State Assembly passed a resolution rejecting linking of biometric Aadhaar with DBT on 2 December 2013.

In a communication to this author, Prof Tarun Kanti Naskar, member of legislative assembly (MLA) from Socialist Unity Centre of India (SUCI) party in West Bengal informed, “the government moved a resolution on Aadhaar opposing only on technical issues like getting the card by 15% of state population thereby a problem of availing the subsidy of LPG. I on behalf of the party supported the resolution saying Aadhaar should be opposed on principled points of views like: violation of Parliament's prerogatives, chance of abuse of power, no statutory sanction, chance of using the personal data for surveillance purposes, outsourcing the data to private organisations and even to abroad etc. The resolution was passed unopposed. Congress was not in the House.”

It is evident that from this resolution that all the parties other than Indian National Congress are opposed to the implementation of Aadhaar based programs. Sonia Gandhi’s proposition has been challenged through Writ Petition (Civil) 833 of 2013 in the Supreme Court by Aruna Roy, her ex-colleague in the National Advisory Council (NAC) because biometric Aadhaar violates the fundamental rights enshrined under Part III of the Constitution of India.  

Unmindful of the fact that people’s right to energy and to cooking fuel funded by government is being snatched away by linking it with Aadhaar. The right to life and livelihood is under tremendous threat because significantly large number of Indians has been moved away from fire wood and coal based cooking. Delhi, for instance claims to be a 100 % LPG state. That means right to life and livelihood can be snatched away with its link with Aadhaar. Thus, the threat of exclusion in absence of Aadhaar based on decrees and sanctions unleashes violence on the people.  This is unconstitutional. 

The resolution of West Bengal State Assembly against Aadhaar paves way for other State legislatures to rigorously examine the ramifications of biometric information based identification of residents of India in the light of global experiences.  

A release of Press Information Bureau (PIB) dated 7 November 2013 issued by Planning Commission states “all necessary steps have been taken for introduction of the National Identification Authority of India (NIDAI) Bill, 2013 in the winter session of Parliament likely to commence from the 1st week of the next month. The Union Cabinet has already approved the proposal submitted by the Ministry of Planning for moving official amendments to the Bill last month.”

It may be recalled that The National Identification Authority of India (NIDAI) Bill, 2010 was introduced in the Rajya Sabha on 3 December 2010 after the launch of 12 digit biometric unique identification (UID)/Aadhhar number by Dr Manmohan Singh and Sonia Gandhi on 29 September 2010. This Bill of 2010 was referred to the Parliamentary Standing Committee (PSC) on Finance. The PSC presented its Report on NIDAI Bill to the Lok Sabha and laid it in Rajya Sabha on 13 December 2011 wherein it questioned the legality, constitutionality and necessity of the UID/Aadhaar number.

The NIDAI Bill proposes to constitute a statutory authority to be called the NIDAI and lay down the powers and functions of the Authority, the framework for issuing biometric Aadhaar numbers, define offences and penalties and matters incidental thereto through an Act of Parliament. It is not clear from this as to what is the current framework for “offences and penalties” and liability and accountability of officials of UIDAI who are “functioning under the executive authorisation” based on the opinion of the Ministry of Law and Justice and the opinion of the Attorney General of India.

Responding to PSC’s report, Planning Commission records that “Among the procedural issues raised by the Committee are untested and unreliable technology, global experience of identity projects, high cost, absence of study on financial implication, duplication of effort with National Population Register exercise and inability to in covering full or near full the marginalised sections.”

After that the Commission unsuccessfully responds stating, “UIDAI, in terms of technology has already generated more than 44 crore Aadhaar and is currently processing over 1 million Aadhaar per day with a capacity to undertake 180 trillion biometric matches per day. This makes it the largest database of its kind in the world. Aadhaar is aimed at building a basic Identity and verification infrastructure for welfare and inclusive growth. It is important to note that the cost projections for the UIDAI project has also been earlier approved by the Government of India for total amount of Rs12,398.22 crore as compared to Rs1.50 lakh crore as reported in some media some time back. The total cumulative expenditure incurred by UIDAI, since inception of the Project, is Rs3,490 crore as on 30 September 2013. A Cost-Benefit Analysis of Aadhaar Project conducted by the National Institute of Public Finance and Policy (NIPFP) shows that the Internal Rate of Return (IRR), in real terms, generated by Aadhaar would be 52.85%. In January 2012, it was decided with the approval of the Cabinet Committee on UIDAI, that NPR and UIDAI enrolments should proceed simultaneously.”

Clearly, the Commission has failed to inform citizens and the legislatures about the “global experience of identity projects” and to respond to the PSC’s charge that “untested and unreliable technology”, large number of enrollment using this technology is hardly an answer. With regard to “absence of study on financial implication” as noted by PSC, even the NIPFP study provides no data on the extent of the leakage, which is sought to be plugged using Aadhaar. The study itself reveals that there is absence of data in this regard. Outdated data can hardly be deemed sufficient. Besides this was not even an ‘independent study’ because researchers did not disclose their conflict of interest emerging from group's research affiliations with the UIDAI.

In its report, PSC has taken the government to task for “duplication of effort with National Population Register exercise”. In a meek response, Planning Commission simply states that it was decided by the “Cabinet Committee on UIDAI (CCUIDAI), that NPR and UIDAI enrolments should proceed simultaneously.” Does reference to the decision of CCUIDAI provide satisfactory answer to the charge of “duplication of effort” made by PSC?  

The UIDAI was set up as an attached office of the Planning Commission as per a notification dated 28 January 2009. It is now proposed to be set up as a statutory authority by the name of NIDAI upon passage of the NIDAI Bill, 2013 after NIDAI Bill, 2010 was rejected by the PSC.

The PIB release notes that PSC had observed that the pending the passage of the Bill issuance of Aadhaar numbers was "unethical" and "violative" of Parliament prerogatives. Responding to PSC’s observation, Planning Commission states, “The issuance of Aadhaar was based on the opinion of the Ministry of Law and Justice and the opinion of the Attorney General of India which had clearly stated that the UIDAI can continue to function under the executive order issued by the Government and there is nothing in the law, or otherwise, which prevents the Authority from functioning under the executive authorisation.”

This claims faces legal challenge in the Supreme Court. If NIDAI Bill, 2013 is sent again to PSC, it too is likely to contest the claim that a Notification of Planning Commission is superior to the Ordinance issued under Article 123 in the Constitution of India that empowers the President to promulgate Ordinance during recess of Parliament. In the case of ordinance, it requires to be passed as an Act by the Parliament within six months of its promulgation to be deemed legal but it is clear from what the government claims that the notification does not mandatorily need Parliament’s consent even after almost five years. Assuming that notification is an act of subordinate legislation, the question is under which parent Act was it issued. It is a fit case for examination by the Parliamentary Standing Committee on subordinate legislation.       

The NIDAI Bill seeks to give statutory status for the Unique Identification Authority of India which wants to database all Indians by claiming to provide them with a biometric data based Aadhaar identity as if Indians do not have an identity. The revised text of the Bill is not in public domain. After the introduction of the Bill it is likely to be sent to PSC on Finance.

The NIDAI Bill seeks to provide “for authentication of the Aadhaar number of an Aadhaar number holder in relation to his biometric information and demographic information subject to such conditions and on payment of such fees as may be specified by regulations” and for “Specifying the demographic information and biometric information for enrolment for an Aadhaar number and the processes for collection and verification thereof; 1 service delivery organisations/Ministries.”

According to US Federal Bureau of Investigation (FBI), “Biometrics are the measurable biological (anatomical and physiological) or behavioural characteristics used for identification of an individual. Fingerprints are a common biometric modality, but others include things like DNA, irises, voice patterns, palm prints, and facial patterns.”

It may be recalled that National Human Rights Commission (NHRC) had issued suo motto notice on 7 February 2011 to the Union Ministry of External Affairs (MEA), when Indian students were made to wear radio collars in Try Valley University in California, US.

In response, a communication from the then Union Foreign Secretary, Nirupama Rao reads: “We have also strongly protested the radio collars as unacceptable, which should be removed immediately. We have also conveyed that we expect the US Government to take steps to prevent such universities from exploiting foreign students."

A collar fitted with a small radio transmitter that when attached to human beings or wild animals can be used in tracking their animal's movements by radio telemetry. Radio telemetry is the use of radio for the transmission of voice information from a transmitter on a free-ranging living entity to a receiver. If biometric profiling is so innocent why NHRC issued notice to MEA and why MEA registered its strong protest against it?   

The case of a leading candidate for the 2012 French Presidency, Dominique Strauss-Kahn, head of International Monetary Fund (IMF) who faced allegations of sexual assault on 32-year old hotel maid also merits attention. He was made to wear electronic monitoring ankle bracelet by New York Supreme Court. If biometric profiling for electronic monitoring is good, why was it used as a punitive tool?

UIDAI had constituted a committee to review the state of biometrics to "serve the specific requirements of UIDAI relating to de-duplication and authentication” and to “obtain consensus (for) widespread propagation of biometrics in governmental and private sectors.” It was set up on 29 September 2009. Notably, Nandan Nilekani was appointed as the Chairperson of UIDAI on 2 July 2009 and he assumed charge on 23 July 2009. The committee on biometrics submitted its report in December 2009.

The UIDAI issued a “notice inviting applications for hiring of biometrics consultant” for “proof of concept of biometric solutions for UIDAI project” in February 2010 ahead of the launch of the biometric data based UID /Aadhaar. But the `UID enrolment proof-of-concept (PoC) report' emerged on the UIDAI’s website in February 2011. It may be noted that it came to light after UID/Aadhaar was already launched in September 2010 by Sonia Gandhi.

The PoC report reads: “The goal of the PoC was to collect data representative of India and not necessarily to find difficult-to-use biometrics. Therefore, extremely remote rural areas, often with populations specialising in certain types of work (tea plantation workers, areca nut growers, etc.) were not chosen. This ensured that degradation of biometrics characteristic of such narrow groups was not over-represented in the sample data collected.

The report did not disclose how will those Indian residents be included whose fingerprints and iris scan cannot be captured. Even Nilekani conceded in his talk in Washington at World Bank office in April 2013, that “nobody has done this before, so we are going to find out soon whether it will work or not”.

Now it is for the Parliament, State legislatures, Supreme Court and High Courts besides citizens to ponder over whether or not they are willing to allow themselves and their coming generations to be treated like guinea pigs for biometric technology companies  to experiment and find out whether it works or not. 

You may also want to read…


Why biometric identification of citizens must be resisted? Part I

Biometric identification is modern day enslavement -Part II

Biometric profiling, including DNA, is dehumanising -Part III

Marketing and advertising blitzkrieg of biometric techies and supporters -Part IV

History of technologies reveals it is their owners who are true beneficiaries -Part V

UID's promise of service delivery to poor hides IT, biometrics industry profits –Part VI

Technologies and technology companies are beyond regulation? -Part VII

Surveillance through biometrics-based Aadhaar –Part VIII

Narendra Modi biometrically profiled. What about Congress leaders?-Part IX

Aadhaar: Why opposition ruled states are playing partner for biometric UID? -Part X


Is Nandan Nilekani acting as an agent of non-state actors? –Part XI


(Gopal Krishna is member of Citizens Forum for Civil Liberties (CFCL), which is campaigning against surveillance technologies since 2010)


NSEL fiasco: EOW attaches properties of directors, borrowers

Till date 322 bank accounts with holdings of Rs170 crore, 206 properties, which have a book value of Rs2,580 crore, 15 vehicles and other assets have been seized from the 11 accused

The Economic Offences Wing (EOW) of the Mumbai police has attached properties of Jignesh Shah, promoter of Financial Technologies India Ltd and Joseph Massey, former managing director and chief executive of MCX-SX. Shah's attached property includes his 1.19 lakh shares in Financial Technologies.


Rajvardhan Sinha, the chief of EOW told reporters that Shah’s smaller shareholding worth about Rs51 lakh in India Energy Exchange Ltd has also been attached.


Along with the shares, his bungalow at Juhu, a row house in Goregaon, suburban Mumbai, which has a book value of Rs78 lakh, land holding in Pune worth Rs1.6 crore, and fixed deposits of Rs11.75 crore have also been seized, Sinha said.


The value of Shah's bungalow in Juhu and four dematerialised trading accounts is yet to be ascertained.


The agency has also attached the properties of Joseph Massey, one of the former directors of NSEL. His two flats in Andheri, suburban Mumbai, and shares worth Rs98 lakh in MCX have been frozen.


Four flats of Shreekant Javalgekar, former Managing Director and CEO of MCX, and Shankarlal Guru’s bungalow in Ahmedabad, have also been seized. Javalgekar’s shares in various companies worth Rs1.2 crore have also been seized.


Guru is the former chairman of NSEL and father-in-law of Nilesh K Patel, owner of NK Proteins Ltd, which owes the commodity exchange Rs969 crore.


Rajvardhan said that till date 322 bank accounts with holdings of Rs170 crore, 206 properties, which have a book value of Rs 2,580 crore, 15 vehicles and other assets have been seized from the 11 accused.


The cumulative book value of these assets is about Rs2,985 crore.


If the assets are valued at the market rate, then it increases to about Rs4,000 crore, Sinha said.


The attachment and seizure process is still incomplete but “we are confident that we will be able to recover 90-95% of the amount stuck in the NSEL crisis. Right now the focus of the investigation is on recovery of money and we are on the right track,” the EOW chief said.


He added that contrary to the popular perception, Shah has managed to get a dividend of Rs160 crore from shareholdings.



Vinay Joshi

4 years ago

Hello Ms.Sucheta,

Jignesh Shah properties are attached.

Your book will continue to 'SHOWCASE HIM'! WHAT A FALLACY?!



Sucheta Dalal

In Reply to Vinay Joshi 4 years ago

Mr Joshi, you are back! What is printed cannot be undone. Also the interview was done before he turned rouge. Don't forget, he still denies it and claims it was an employee who destroyed him. The courts will decide. But yes, the next edition of the book will not feature him. Meanwhile, there are some amazing role models and their insights in the book -- have you read it? I am sure you will agree that we cannot make a bonfire of existing stock of expensive books because of one interview!
And yes, there are others like Chougule of Champagne India who have gone bankrupt again -- but it is still a fascinating story of amazing chutzpa and achievement. As I said… did you read the books?

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