Role Functions of Exim Bank Trivandrum July 17

Role & Functions of Exim Bank Trivandrum, July 17, 2009 Roshanara Sardar Manager Exim Bank, Chennai

2 Exim Bank of India q SET UP BY AN ACT OF PARLIAMENT IN SEPTEMBER 1981 q WHOLLY OWNED BY GOVERNMENT OF INDIA q COMMENCED OPERATIONS IN MARCH 1982 q APEX FINANCIAL INSTITUTION q OBJECTIVES: “… for providing financial assistance to exporters and importers, and for functioning as the principal financial institution for coordinating the working of institutions engaged in financing export and import of goods and services with a view to promoting the country’s international trade…” “… shall act on business principles with due regard to public interest” (Export-Import Bank of India Act, 1981)

3 Evolving Vision Product Centric Approach Export Credits 1982 -85 Export Capability Creation “To develop commercially viable relationships with a target set of externally oriented companies by offering them a comprehensive range of products and services, aimed at enhancing their internationalisation efforts” 1986 -94 Comprehensive Range of Customer Centric Products And Services Approach – All Stages of the Export Business Cycle – Exim Bank TODAY Leadership and Expertise in India’s Export Finance

4 Organisation BOARD OF DIRECTORS (16)* OFFICES q Chairman and Managing Director Domestic Offices: 9 Overseas Offices: 6 q 5 Directors: Government of India q Ahmedabad q London q Bangalore q Dakar q Chennai q Durban q Guwahati q Dubai q Hyderabad q Singapore q Kolkata q Washington D. C. q 3 Directors: Scheduled Banks q 4 Directors : Professionals/Experts q 1 Director nominated by RBI q 1 Director nominated by IDBI q 1 Director nominated by ECGC Appointed by Govt. of India * As per Exim Bank Act q New Delhi q Mumbai q Pune

5 Operational Philosophy International Trade Financing Promoting Facilitating Through Variety of Financing Programmes Value Added Business Advisory Services Research & Analysis Catalyst for Financing Projects Products Services

6 Range of Products & Services Presence Across All Stages of Business Cycle Export Marketing Pre. Shipment Export Production Advisory Services Post. Shipment Export Product Development Value Based Services Knowledge Building Investment Abroad INFORMATION Import Finance Advisory Services SUPPLEMENTS FINANCING PROGRAMMES

7 Financing Programmes (Various Currencies) Export Credit Medium / Long Term - Lines of Credit - Buyer’s Credit - Supplier’s Credit Short Term - Pre/Post Shipment Credit Import Credit - Import Loan for capital goods - Bulk Import Loan for Raw Materials Loans for Exporting Units - Term Loans for expansion/ diversification/ new projects/ export product development/ export marketing/ research & development - Term Loans for overseas equity investment - Direct equity stake in Indian/ Overseas ventures of exporting companies

8 Export Marketing Finance q Administered an Export Marketing Fund from World Bank q SMEs extended export marketing finance to implement strategic export marketing plans aimed at entry into developed country markets and term loans for supply side upgradation q Exim Bank’s assistance resulted in generation of significant exports to developed country markets q Many of these companies have become large companies with high export orientation q Based on the successes achieved in the programme implemented by Exim Bank in India, the Bank has shared its experience with other developing countries, with World Bank funding q Over 300 companies supported in variety sectors: ® Knitting ® Pharmaceuticals ® Herbal Products ® Needles ® Jute Products ® Textiles ® Polyester Ropes ® Printing Machinery ® Software ® Home Appliances ® Auto Components ® Castings

9 Lines of Credit q Exim Bank’s extends export Lines of Credit (LOC) to overseas financial institutions, regional development banks and foreign governments and their agencies and Buyers’ Credits (BC) to foreign corporates q LOCs also extended at the behest of Government of India q LOCs serve as a market entry mechanism to Indian exporters and provide a safe mode of non-recourse financing option to Indian exporters q LOCs/BCs are particularly relevant for Indian SME exporters as the payment risk is borne by Exim Bank q Bank has in place 117 operative LOCs covering more than 94 countries of value of over US$ 3. 85 billion

10 Enterprise Management Development Services q Competency as Collateral : ® Development of Loan. Com an IT tool kit which will enable SMEs to develop bankable business plans thereby enhancing their access to finance ® Tool kit will also enable lending institutions to screen viable projects ® Pioneering initiative for supporting SMEs and for providing term loans and export finance facilities to identified units to help them in their globalisation efforts. ® Learning from the programme to be transferred to other developing countries; capacity creation and institution building in the global arena. ® Exim Bank has already financed select firms by way of term loans and export finance facilities, using the tool kit THIS INITIATIVE HAS BEEN LAUNCHED BY ITC FOR THE FIRST TIME WITH EXIM BANK AS A PARTNER.

11 Global Trade Finance under IFC q Agreement between Exim Bank and International Finance Corporation (IFC) q Envisages confirmation of Letters of Credit (L/Cs), Standby letters of Credit, demand guarantees, promissory notes or bills of exchange received by Indian exporters q From 105 pre-approved banks in more than fifty countries of IFC’s operation q Covers the risk of non-payment by Issuing Bank to Negotiating / Paying banks

12 Export Marketing Services q Exim Bank has launched an ‘Export Marketing Services’ programme q Seeks to help Indian SME sector to establish their products overseas and enter new markets through Exim’s overseas offices and institutional partner network q Helps Indian SMEs in their export efforts by proactively assisting in locating overseas buyers/partners for their products/services q No upfront fees, but operates on success-fee basis q Some of the sectors assisted include : ® Agricultural Equipments to Senegal ® Processed foods to Singapore & Italy ® Ayurvedic Products to Hungary ® Agarbathis to S. Africa and Singapore ® Tiger Prawns to a leading restaurant chain in S. Africa ® Cotton fabrics to S. Africa ® Natural Sandstone and Tiles to Hungary ® Incense sticks to Singapore, S. Africa, USA ® Lucknow Chikan Kurtas to Singapore ® Setting up of oil mill on turnkey basis in Senegal (pipeline) ® Grapes and Pomegranates to Singapore ® Seting up of Solar City in Senegal(pipeline)

13 Seminars / Workshops q Eximius Centres of Learning for knowledge building & capacity creation for SMEs – Bangalore/Pune/ Ahmedabad q Set up to organise seminars and workshops for the benefit of exporting companies, particularly SMEs q Subjects include: ® International trade & investment ® Quality ® Export marketing ® Packaging ® Sector and country specific ® Business opportunities in multilateral programmes agencies funded projects

14 Research Publications q Exim Bank has brought out Research Papers pertaining to SMEs on policies, institutional support and infrastructure ® Institutional Support to SMEs: A Study of Select Sectors ® Institutional Support Systems for SMEs in India and International Experiences ® Export Performance of Small and Medium Enterprises in India q Others research papers on sectors that are predominated by SMEs include: ® Sports Goods ® Indian Handicrafts ® Chemicals ® Leather q The Bank has also brought out a publication on ‘Business Practices of Successful Indian Exporters’, outlining the internationalisation strategies adopted by successful Indian firms including SMEs q ‘Agri Export Advantage’, Advantage’ a bimonthly publication in English, Hindi and 10 regional languages

15 Agri Business Group q The Bank has put in place an ‘Agri Business Group’ è The Group looks for viable projects and export transactions in agriculture sector. q The Bank has set up an agro-portal, in-house, which is an IT initiative to promote knowledge-based agriculture enterprise. www. eximbankagro. in q The Bank brings out a bi-monthly newsletter ‘Agri Export Advantage’ to facilitate information dissemination in 10 regional languages. q Brought out following study reports; è Organic Farming è Plantation Sector è Agro & Processed foods –Export Opportunities q Assisted a number of Small and Medium exporters in the Agro Sector covering following products; è Honey, Mango pulp, mushrooms, gherkins, fresh & processed fruits & Vegetables

16 Promoting Investment Supporting two-way investment q Comprehensive assistance: è Pre investment advisory services è Finance through debt and equity q Finance available for: è Greenfield projects; è Brownfield expansion; è Overseas acquisitions directly or through special purpose vehicles q Direct equity participation in Indian ventures abroad q Joint investments by Indian and overseas company in third country markets in addition to facilitating investments into India.

17 Institutional Linkages Multilateral Agencies q World Bank q EBRD q ADB q African Development Bank q MIGA q IFC q UNCTAD Trade & Invt. Promotion Agencies q Board of Investment of Mauritius q Netherlands Council for Trade Promotion q Board of Investment of Sri Lanka q Sharjah Chamber of Commerce & Industry q Caribbean Association of Industry & Commerce Export Credit Agencies q Afrexim Bank q National Bank of Egypt q Czech Export Bank(CEB) q Belvnesheconombank, Belarus q Czech Export Bank q Hungarian Exim Bank q Exim Bank of China

18 Exim Bank: Partner in Globalisation q Technology q Final Products EX q Capital (Foreign Investment) RT q Raw Materials q Capital (Overseas Ventures) q Capital Goods I M P O R q Capital Goods PO q Product Development q Production T VALU E AD N O TI I D q Marketing q Pre shipment q Post shipment

THANK YOU Website www. eximbankindia. in