Along with these relaxations, the government withdrew the existing facility available to corporates of pre-payment to an extent of 20 per cent in the company's outstanding balance.

The late evening communique, issued by the finance ministry, says that in the wake of continued uncertainty in international financial markets following the Southeast Asian crisis, the government has decided to review the guidelines.

As per existing norms, corporates are given six months' time to financially close and for the financial agreements to be taken on record. In case they are unable to do so, there is a cooling off period of three months before they can re-apply for an external commercial borrowing. In view of the prevailing difficult internationalfinancial market situation, it has been decided to further reduce the cooling off period from three months to one month, the release says. This comes into effect immediately.

It has also been decided to permit an extension of validity of one month across the board for all approvals which will lapse between July 1 to July 31, 1998. This would be applicable only to those approvals which have lapsed before July 1, 1998. In other words, approvals which are valid as per existing guidelines on July 1, 1998, will not get this facility, the release says.The communique clarifies that this is a one-time extension purely to accommodate requests of companies which have sought time for conclusion of financial closure on account of delay due to uncertainty in financial markets.Guidelines for 1998-99 on ECBs have permitted a one-time prepayment up to 20 per cent of the present balance outstanding of each ECB across the board for all maturities.