PM Modi's Bangladesh visit: $2 billion line of credit to create 50,000 jobs in India

NEW DELHI: What is good for Bangladesh is good for India. The government is extending a $2-billion line of credit to Dhaka which is expected to create 50,000 jobs in India and provide a big boost to the Make in India drive.

A line of credit is a promise to provide loans at subsidized rates from agencies such as Exim Bank. These are normally conditional on the recipient using the loan amount to buy equipment and services from Indian entities like BHEL, RITES and small and medium enterprises.

“We have already provided $862 million line of credit to Bangladesh and this $2 billion is going to provide a big boost to project exports from India and help Indian companies,“ Yaduvendra Mathur, chairman and managing director of Export Import Bank of India, told TOI.

He said the line of credit will also provide a huge boost to sectors like steel and cement as they will be exported to Bangladesh for the projects undertaken there. “It is a big boost not only to manufacturing and projects but also to create jobs,“ Mathur said. Since taking over PM Narendra Modi has extended nearly $6 billion line of credit under his `Look East' policy to Nepal, Bangladesh, Sri Lanka and the Maldives.

The Exim Bank has set up a special infrastructure facility in its Delhi office to route the projects from India and is working closely with the ministry of external affairs on boosting project exports.

Under the line of credit (LOC) a minimum of 75% of goods and services needs to be of Indian origin and must be procured from India. Exim Bank plays an active role in supporting Indian project exporters to execute developmental projects in over 60 countries which in turn provide immense opportunities to Indian firms to demonstrate their project execution capabilities, according to Mathur.