The Reserve Bank of India on Wednesday tightened the norms for issuing "Masala Bonds" by India Inc.
Masala Bonds are Rupee-denominated bonds issued in offshore capital markets.
According to the RBI, the raising of such rupee-denominated debt instrument would now be subject to apex bank's approval.
"It has been decided that any proposal of borrowing by eligible Indian entities by issuance of these bonds will be examined at the Foreign Exchange Department, Central Office, Mumbai," the RBI said in a notification.
"Further, it has also been decided to revise the provisions in respect of maturity period, all-in-cost ceiling and recognised lenders (investors) of Masala Bonds."
Besides, the Rupee-denominated bonds (RDBs) will have to maintain a minimum maturity period, adhere to all-in-cost ceilings and cannot be issued to related parties.
In September 2015, the RBI had allowed India Inc. to issue Rupee-denominated bonds overseas as another source of credit.