By the end of this October the L&T Hyderabad Metro Rail is expecting to get Rs 1,000 crore External Commercial Borrowings (ECBs) from Indian Infrastructure Finance Company (IIFCL) The company's objective for looking at ECBs is to save on interest besides securing long-term debt.
ECBs are expected to protect the company from a possible financial impact in the backdrop of the weak Rupee, escalation of raw material and manpower cost and fluctuating Dollar-Rupee parity.
The discussions have progressed very well. All the formalities from both the sides have been completed. L&T has already secured over Rs 11,000 crore loan from a consortium of banks led by SBI and spent more than Rs 750 crore out of the loan.
As part of the concessional agreement with the company, the Union government has allocated Rs 1,458 crore viability gap funding (VGF).