High hedging costs and rupee slump slash India Inc foreign borrowing by half in March

March borrowing fell 51% as hedging turned punitive

Foreign currency borrowing by Indian corporates dropped sharply in March, falling 51% to $5.43 billion from $11.04 billion a year earlier. RBI data points to higher interest rates, a weakening rupee, and especially rising hedging costs that made overseas loans less attractive. Even FY26 figures reflect the slowdown, with ECBs and FCCBs down 30% to $42.87 billion. Instead of borrowing at higher costs, many firms allowed annual limits to lapse.