ECGC to review Ukraine's rating for export credit insurance

HYDERABAD: State-owned Export Credit Guarantee Corporation of India (ECGC) may review its rating to Ukraine following the crisis in that country, a top official said.

"We will have to review the rating for Ukraine. We will be reviewing it now. It will be done shortly," ECGC CMD N Shankar told reporters on the sidelines of a programme here.

ECGC provides export credit insurance facilities to Indian exporters and banks.

Ukraine is India's second-largest trading partner in the Commonwealth of Independent States (CIS) after Russia. In 2012-13, India's total trade with Ukraine was USD 3.18 billion, of which, exports were USD 519 million and imports were USD 2.65 billion.

ECGC determines export credit insurance premium on the basis of ranking from A to D it allots to each country. The lower the ranking the higher the premium.

"Ukraine issue...we will have to take the latest situation. We give ranking from A to D. Suppose the classification goes down (for any country), the premium price may go up. I do not want to guess what the ranking would be for Ukraine," Shankar said when asked about the possibility of downgrading the Eastern European nation.

Replying to a query, he said the ECGC is going to offer direct factoring facility for micro, small and medium enterprises (MSMEs) from the second quarter of the current financial year.

The corporation paid out cash claims for an aggregate amount of Rs 898 crore against the premium of Rs 1,304 crore during 2013-14, to Indian exporters and banks.

He said the PSU may open three more branches shortly in Chennai, Ahmedabad and Kollam. Currently, it has a network of 62 offices including one overseas office.

IRDA chairman T S Vijayan today inaugurated the ECGC's bank business branch.