Cabinet approves Rs 6000 of capital infusion in the state owned Exim banks

New Delhi, January 16: The government today has approved a capital infusion of ₹6,000 crore in state-owned Exim Bank with a view to expand its business. The Union Cabinet, chaired by PM Narendra Modi and addressed by Piyush Goyal, also approved doubling the bank’s authorised capital from ₹10,000 crore to ₹20,000 crore.

 

 

Briefing reporters about the decisions, Rail Minister Goyal said, “It has been decided to issue recapitalisation bonds by the government of India to the tune of ₹6,000 crore for capital infusion inExport Import bank of India.

 

“The equity will be infused in two tranches of ₹4,500 crore in 2018-19 and ₹1,500 crore in 2019-20, respectively,” he said.

 

The recapitalisation bonds will be on the lines of those issued to public sector banks. The infusion of capital into Exim Banks would enable it to augment capital adequacy and support Indian exports with enhanced ability.

 

“Exim Bank is the principal export credit agency in India and the infusion will give an impetus to new initiatives such as supporting Indian textile industries, likely changes in the Concessional Finance Scheme, likelihood of new letters of credit in future in view of the country’s active foreign policy and strategic intent”, he asserted further.

 

Established by the Government of India in 1982, Exim Bank is the apex financial institution for financing, facilitating and promoting the country’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.