ANNOUNCEMENT 18 Nov 2015In November 2015, the government of India announced a change in its trade finance instruments.
NUMBER OF INTERVENTIONS
Official Press release - 18 November 2015
Guidelines - 7 December 2015
On 18 November 2015, the Indian Cabinet Committee of Economic Affairs extended the Indian Development and Economic Assistance Scheme (IDEAS) for the second time and for a period of five years from 2015-16 to 2019-20.
Through IDEAS, India provides Lines of Credit to African and other developing countries as part of its diplomatic strategy. The Export Import Bank of India or any other approved bank/lending agency raise resources from the capital market and provide credit to the recipient governments at a concessional rate. The difference between the market and the concessional rate is borne by the Indian government (called the Interest Equalization Support). India has earmarked approximately USD 589.34 millions as interest rate support over the next five year period under this Scheme
These Lines of Credit have compulsory requirements on the borrowing country to source atleast 75% of the project related goods from India, with a maximum relaxation of 10%.
The guidelines for the scheme were published by the Ministry of Finance on 7 December 2015.