As part of its outreach to smaller countries, India is expected to further loosen its purse strings.The Indian cabinet on Wednesday approved capital infusion of Rs 6,000 crore into Exim Bank, which, among its other functions, extends lines of credit to foreign countries, an official statement said.
The recapitalisation of the bank will be done in two tranches of Rs 4,500 crore in financial year 2018-19 and Rs 1,500 crore in financial year 2019-20 respectively.
The cabinet also approved an increase in the authorised capital of Exim Bank from Rs 10,000 crore to Rs 20,000 crore. The recapitalisation bonds will be on the lines issued to public sector banks, the statement added.
India has given $8 billion in lines of credit to Bangladesh in the last nine years.Exim Bank is the principal export credit agency for India and the infusion of capital into the bank will enable it to augment capital adequacy and support Indian exports with enhanced ability.
The capital infusion will also give an impetus to new initiatives like supporting Indian textile industries, bring changes in concessional finance scheme (CFS) and make way for new lines of credit (LoC) in future in view of India’s active foreign policy and strategic intent, said the statement.
The Exim Bank of India was established in 1982 under an act of parliament as the apex financial institution for financing, facilitating and promoting India’s international trade.
The bank primarily lends for exports from India including supporting overseas buyers and Indian suppliers for export of developmental and infrastructure projects, equipment, goods and services from India.
For more update Click Here
For Information Source Click here