ANNOUNCEMENT 05 Nov 2020
India has extended a line of credit to Nicaragua to support India's exports.
NUMBER OF INTERVENTIONS
RBI/2020-2021/64 A.P. (DIR Series) Circular No. 04
On 12 June 2020, the Export-Import Bank of India (EXIM Bank) extended a Line of Credit (LoC) of USD 20.10 million to the Government of Nicaragua for financing the reconstruction of the Aldo Chavarria Hospital. The loan is issued to promote the exports of Indian goods to Nicaragua by requiring the sourcing of goods for the project from India. The HS codes identified here are those plausibly associated with the construction of a hospital.
The Agreement is effective from 15 September 2020 and has a terminal utilization period of 60 months from the scheduled completion date of the project.
Lines of Credit
The Export-Import Bank of India extends Lines of Credit to overseas financial institutions, regional development banks, sovereign governments, and other overseas entities. These loans are made on deferred credit terms to enable buyers from these countries to import goods for developmental and infrastructure projects, and other types of equipment, goods, and services from India. This is done with the motive of supporting Indian exporters in new overseas markets by reducing the payment risk from such importers.
The GTA includes trade finance loans and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.
On 12 June 2020, India has extended a Line of Credit to Nicaragua worth USD 21.10 million to reconstruct a hospital in Nicaragua. The credit agreement requires that at least 75% of the contract price of the goods, works, and services part of the project are supplied by the seller from India.
The agreement is effective from 15 September 2020.