State-owned Indian Oil Corp (IOC) may raise about $3 billion more through US dollar bonds issue after the Reserve Bank permitted fuel retailers to raise an overseas loan to check fall in rupee value, its Chairman Sanjiv Singh said on Wednesday.

IOC is already in market to raise $900 million through a bonds issue and is raising an equivalent sum through a syndicated loan for meeting its working capital requirements.

“Yes, we will certainly look at raising more overseas loans within the limit set up by RBI,” he told reporters.

RBI had in October last year relaxed external commercial borrowing (ECB) policy for IOC, Hindustan Petroleum Corp Ltd (HPCL) and Bharat Petroleum Corp Ltd (BPCL) to allow them to raise $10 billion in overseas loans for working capital needs. It had lifted the individual borrowing limit for the three firms which was set at $750 million.

“The three OMCs (oil marketing companies) were allowed to raise $10 billion and we reckon our share of that would be around $5 billion,” he said. “We will certainly look at opportunities to raise overseas funds.”

He, however, said no timelines have been set for raising of additional loans.

Singh said since India imports over 80 per cent of its crude oil and pays most of it in US dollars, an overseas loan in the American currency acts as a natural hedge during currency fluctuations.

Economic Affairs Secretary Subhash Chandra Garg had in October stated that the RBI relaxation would help the oil companies raise as much as USD 10 billion for maturity periods of three to five years.

The RBI move had followed rupee losing 13 per cent to the dollar during the year and allowing oil companies – who are the biggest buyers of US dollars – to raise overseas loans that would ease pressure on the currency.

IOC in a regulatory filing on Tuesday said that it has launched an international bonds issue of $900 million, carrying a coupon of 4.75 per cent.