Sep 16, 2012

India's Exim Bank may open branch in Myanmar

The Exim Bank is exploring options to set up a branch in Myanmar, according to Executive Director Prabhakar Dalal.

The bank has signed a memorandum of understanding for extending a line of credit of $500 million to that country.

Dalal, who was here in the Gitam School of International Business in connection with the graduation ceremony on Sunday, told reporters that that there was a likelihood of setting up a branch in Myanmar. At present, the Exim Bank has 10 branches in the country and seven abroad.

He said the bank was extending line of credit to 75 countries to the extent of $8.2 billion, enabling Indian exporters/companies to take up infrastrucutural and other projects in those countries. Concessional credit would be made available to those countries. Besides, he said, the bank was also offering buyer's credit to Indian companies for taking up projects abroad. "We have recently signed agreements with two companies and 24 more such projects are in different stages of negotiations," he said.

He said the third important activity of the bank was to extend finance and enable Indian companies to form joint ventures abroad or to acquire companies abroad. "Many Indian companies are now ready either to form JVs or go for acquisitions abroad. Exim Bank will give them credit for equity acquisition or it will stand guarantee. The bank may even participate in equity along with Indian companies," he said.

He said the bank had sanctioned credit of Rs 44,412 crore during the last financial year and disbursed Rs 37,045 crore. It was expecting 18 per cent growth during the current financial year.

Earlier, reviewing the export performance of the country in his address to the students, Prabhakar Dalal said, "India's relatively low export/GDP ratio means that our country has been less damaged by the global slowdown than other countries. The Union Government has fixed an export target of $500 billion by 2014, and it is to be achieved by diversifying its products and markets. The Exim Bank will play its role in the endeavour."

He said the global financial crisis also offered a wonderful opportunity to the Indian companies to make their presence felt abroad.

Source: The Hindu Business Line