Exim Bank's Line of Credit (LOC) of USD 5 million to
Nigerian Export-Import Bank
A.P. (DIR Series) Circular No. 24,
dated 23-1-2008
Export-Import Bank of India (Exim Bank) has concluded an agreement
dated September 14, 2007 with the Nigerian Export-Import Bank, making available
to the latter, a Line of Credit (LOC) of USD 5 million (USD Five million only)
for financing export of capital and engineering goods, industrial manufactures,
consumer durables, commodities and services including consultancy services from
India. The goods and services for export under the agreement are those which
are eligible for export under the Foreign Trade Policy of the Government of
India and whose purchase may be agreed to be financed by Exim Bank under this
agreement. Out of the total credit under this Agreement, the goods and services
of the value of at least 85 per cent of the contract price shall be supplied by
the seller from India.
2. The Credit Agreement under the LOC is effective from
December 4, 2007. Under the LOC, the last date for opening Letters of Credit
and disbursement will be December 3, 2009 (24 months from the effective date of
the Agreement).
3. Shipments under the credit will have to be declared on
GR / SDF Forms as per instructions issued by Reserve Bank from time to time.
4. While no agency commission shall be payable in respect
of exports financed under the above line of credit, the Reserve Bank may
consider, on merit, requests for payment of commission up to a maximum of 5 per
cent of the f.o.b / c&f / c.i.f. value in respect of goods exported and
which require after sales service. In such cases, commission will have to be
paid by deduction from the invoice of relevant shipment to agents and the
reimbursable amount by the Exim Bank to the negotiating bank will be 90 per
cent of the f.o.b / c&f /c.i.f. value. Approval for the payment of
commission should be obtained from the Regional Office of the Reserve Bank of
India (Foreign Exchange Department) within whose jurisdiction the Head Office
of the exporter is situated, before the relevant shipment is effected. In other
cases (i.e. exports not involving after sales service), if required the
exporter may use his own resources or utilize balances of his EEFC account for
payment of agency commission in free foreign exchange. Authorised Dealer
Category –I (AD Category – I ) banks may allow such remittance after
realisation of full payment of contract value subject to compliance of
prevailing instructions on payment of agency commission.
5. AD Category - I banks may bring the contents of this
circular to the notice of their exporter constituents and advise them to obtain
full details of the Line of Credit from Exim Bank's office at Centre One, Floor
21, World Trade Centre Complex, Cuffe Parade, Mumbai 400 005.
6. The directions contained in this circular have been
issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act
(FEMA), 1999 (42 of 1999) and is without prejudice to permissions / approvals,
if any, required under any other law.