Canada exim bank extends $500 mn loans to Tata Group

Mumbai: The Export Development Canada (EDC) has agreed to extend Tata Sons loans worth USD 500 million annually to help small and medium exporters from the North American country to tap the Tata group's global supply chain.

Under the USD 500 million financing agreement with the diversified Group, the EDC will underwrite loans of Canadian firms, particularly small-to-medium-sized exporters, within Tata companies' global supply chains, the Indian conglomerate said in a statement.

The EDC is the state-run trade finance agency of Canada, providing financing and insurance solutions locally and around the world to help Canadian companies respond to international business opportunities.

Tata companies have invested over CAD 1.3 billion in Canadian operations over the past five years (CAD 355 million in last year alone), with active consideration for new developments going forward, the statement added.

The salt-to-software conglomerate employs around 3,000 people in Canada among the Group companies like TCS, Tata Steel, Tata Global Beverages, Tata Chemicals, Tata Communications, Tata Technologies and Tata Interactive.

Their facilities in that country include an IT development centre in Ontario, telecommunications units in Quebec and Ontario, iron ore mining in Quebec and soda ash distribution centres in Quebec and New Brunswick.

Also, Tata companies have more than 1,000 Canadian suppliers.

"The EDC continues to be a very important partner for the Group and this funding arrangement will facilitate the expansion plans of Tata companies in Canada," Tata Sons Group Executive Council member Madhu Kannan said.

EDC President and Chief Executive Benoit Daignault said "the Tata Group is a critical organisation within a key market for us and this financing agreement is a reflection of the Tatas' importance to Canadian exporters."