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LOC facility of Exim Bank sees rapid growth

The LOCs enable buyers in developing countries to import developmental and infrastructure projects, equipment, goods and services from India, on deferred credit terms. `` Over the last ten years LOC portfolio has grown exponentially,’’ said A Ajay Kumar, joint secretary (DPA-1), ministry of external affairs.

ET Bureau|
Last Updated: Jan 23, 2020, 08.38 PM IST
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As of December 31, 2019, Exim Bank has signed 257 LOCs covering 61 countries in five continents with credit commitments aggregating $25.15 billion.
KOCHI: The lines of credit (LOC) facility offered to overseas buyers by the export-import bank of India (Exim Bank) has witnessed a rapid growth in the last few years

The LOCs enable buyers in developing countries to import developmental and infrastructure projects, equipment, goods and services from India, on deferred credit terms. `` Over the last ten years LOC portfolio has grown exponentially,’’ said A Ajay Kumar, joint secretary (DPA-1), ministry of external affairs.

As of December 31, 2019, Exim Bank has signed 257 LOCs covering 61 countries in five continents with credit commitments aggregating $25.15 billion. Beside these, 41 LOCs amounting to $5.50 billion are in the pipeline. The total commitment will then rise to 298 LOCs of $ 30.62 billion to 64 countries over the world, he added.

Currently, around 52% and 41% of the total LOC commitments are to Asia and Africa Regions, respectively. In terms of total number of LOCs extended, Africa is the largest recipient Region. Value-wise it is the Asia Region that is leading because of a few high-value LOCs to our neighbouring countries, said Sudatta Mondal, chief general manager of Exim Bank. The total outstanding loan balance under the LOCs as on December 31, 2019, stood at $ 5.63 billion.

They were in Kochi to participate in seminar on business opportunities Exim bank’s LOC for exporters from Kerala

The Indian companies benefit from the program as a minimum 75% of the value of goods and services covered under the LOC programme are typically sourced from India, and Exim Bank assumes the credit and political risks of the overseas buyers.

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