Government of India on Wednesday approved a capital infusion of Rs 6,000 crore in state-owned Exim Bank.
The Union Cabinet, chaired by Prime Minister Narendra Modi, also approved an increase in the bank’s authorised capital from Rs 10,000 crore to Rs 20,000 crore.
Railway Minister Piyush Goyal told said, “it has been decided to issue recapitalisation bonds by the Government of India to the tune of Rs 6,000 crore for capital infusion in Export-Import Bank of India (Exim Bank).”
“The equity will be infused in two tranches of Rs. 4,500 crore in 2018-19 and Rs.1,500 crore in 2019-20 respectively,” he added.
Exim Bank is the principal export credit agency for India and the infusion will give an impetus to anticipate new initiatives like supporting Indian textile industries, likely changes in Concessional Finance Scheme (CFS), likelihood of new letters of credit (LoCs) in future in view of India’s active foreign policy and strategic intent.
Exim Bank was established in 1982 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.