State-owned oil marketing companies have been allowed to raise USD 10 billion from overseas market to meet their working capital needs, a top finance ministry official said Wednesday.
The move comes against the backdrop of rising crude oil prices in the international market which is near USD 85 to a barrel. As a result, petrol and diesel prices in the domestic market have also touched record high.
Public sector oil marketing companies include Indian Oil Corporation, HPCL and BPCL.
"Public Sector Oil Marketing Companies will raise USD 10 billion for 3-5 year for financing their permanent working capital. RBI has also granted necessary exemptions under the ECB policy," Economic Affairs Secretary S C Garg said in a tweet.
The Reserve Bank of India (RBI) separately said the overall ceiling for such external commercial borrowings will be USD 10 billion equivalent and the said facility will come into effect from the date of the circular
"It has been decided, in consultation with the Government of India, to liberalise the said provision and permit public sector Oil Marketing Companies (OMCs) to raise ECB for working capital purposes with minimum average maturity period of 3/5 years from all recognized lenders under the automatic route," the circular said.