Export-Import Bank of India (Exim Bank) has entered into an agreement with Nepal to provide a billion US dollar credit line for exports of Indian goods and services.

Under the agreement, letters of credit (L/Cs) can be opened and disbursements made for Indian firms undertaking work in specific projects that will help Nepal recover the devastating earthquake it suffered in April.

Major projects

Exim Bank has entered into an agreement to make a credit line of US$1 billion available for financing the setting up of hydropower, irrigation and infrastructure development projects in Nepal.

Of the total Exim Bank credit, goods and services including consultancy services of the value of at least 75 per cent of the contract price must be supplied by the seller from India except from civil works for which 50% of the contract price shall be supplied by the Seller from India.

L/C timings

Under the agreement, the last date for opening of L/Cs and disbursements will be 48 months from the scheduled completion date of contracts in the case of project exports and 24 November 2020 in the case of other supply contracts.

Exim Bank has entered into similar agreements with Rwanda (DC World News, 2 January 2014; Togo (DC World News, 5 November 2014); Niger (DC World News, 8 December 2014) as well as Cuba and Myanmar (DC World News, 1 April 2015).

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.