Lok Sabha approves bill to raise capital of Exim Bank to Rs 10,000 cr

NEW DELHI: The Lok Sabha today approved a bill to increase the authorised capital of Export Import Bank of India ( Exim Bank) from Rs 2,000 crore to Rs 10,000 crore.

The amendments to the Exim Bank Act 1981, which was moved for consideration by Minister of State for Finance Namo Narain Meena, also authorises the government to raise the authorised capital of the Bank in future through a notification.

"The amendment will help the Exim Bank to promote its objective of raising exports...providing more letters of credit (LoCs) to exporters," he said, winding up the debate on the bill.

The Minister said the bill only introduced an enabling provision that the actual increase in paid-up capital would be effected through budgets.

The Exim Bank, he said, needed more capital as its business has increased from Rs 368 crore in 1982 to more than Rs 1 lakh crore presently and has very little headroom to further enhance its operations.

Following the amendments, he said, the Exim Bank will be able to have two executive directors as against one currently.

The Bank, set up in 1981, has a net worth of Rs 5,230 crore and Non-Performing Assets of 0.02 per cent, which is lowest in the financial sector, Meena said.

Exim Bank, he said, has been promoting export to several developing countries in Africa and other regions.

Responding to criticism that Exim Bank was not providing enough credit to small and medium enterprises, Meena said, "about 2.6 per cent of the credit was given to the small sector" by the institution.

Among those who participated in the debate include Balkrishna Khanderao Shukla (BJP), K S Rao (Cong), Vijay Bahadur Singh (BSP), B Mehtab (BJD) and Raghuvansh Prasad Singh (RJD).