New Delhi: The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the recapitalization of Export Import Bank of India (Exim Bank) to the tune of Rs 6,000 crore.
The equity will be infused in two tranches of Rs 4,500 crore in FY 2018-19 and Rs 1,500 crore in FY 2019-20 respectively, an official release said.
The Cabinet has also approved an increase in the authorized capital of Exim Bank from Rs 10,000 crore to Rs 20,000 crore. The recapitalisation bonds will be on the lines issued to Public Sector Banks.
The infusion of capital into Exim Bank will enable it to augment capital adequacy and support Indian exports with enhanced ability, government said. It will also give an impetus to anticipate new initiatives like supporting Indian textile industries, likely changes in Concessional Finance Scheme (CFS), likelihood of new LoCs in future in view of India's active foreign policy and strategic intent.
Exim Bank, the principal export credit agency for India, was established in 1982, as the apex financial institution for financing, facilitating and promoting India'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.