Housing and Urban Development Corporation Ltd. (HUDCO) is preparing a fresh overseas borrowing plan to fund India’s growing urban infrastructure needs. The company said it wants to raise USD 1.3 billion via external commercial borrowings in the next five months, taking its total ECB target to as much as USD 2 billion by December 31, 2026.
HUDCO Chairman and Managing Director Sanjay Kulshrestha said the company has already mobilised USD 700 million through ECBs in the current financial year. The remaining USD 1.3 billion will be raised depending on funding requirements. This will be HUDCO’s first USD-denominated ECB programme, as the company has mostly borrowed in Japanese yen in the past.
The borrowing plan comes at a time when the Reserve Bank of India has opened a special USD-Rupee forex swap window for public sector undertakings. This window is designed to lower currency hedging costs, making foreign borrowings cheaper and more practical for infrastructure lenders. HUDCO said its ECB borrowing so far has come at an interest rate of 6.25% per annum.
HUDCO plays a key role in financing housing and urban development projects across the country. The new funds are expected to support city infrastructure, housing, and other public projects that need long-term financing. The company is also targeting about Rs 75,000 crore in fundraising for FY27, of which Rs 20,000 crore has already been mobilised, including ECBs.
FAQs [Frequently Asked Questions]
1. Why is HUDCO raising USD 1.3 billion?
HUDCO is raising the money to fund urban infrastructure projects in India. The funds will help support housing, city development, and other long-term public infrastructure needs.
2. What is ECB in this case?
ECB means External Commercial Borrowing. It is money borrowed from foreign lenders or global markets, usually at competitive rates, to finance domestic projects.
3. What makes this borrowing plan important?
It matters because HUDCO is using a special RBI swap window that lowers hedging costs. This can make foreign borrowing cheaper and help speed up urban infrastructure funding.