Exim Bank negotiating $100 million loan from ADB for SME units in backward states

NEW DELHI: The Export-Import ( Exim Bank) today said it is negotiating a USD 100 million loan from multi-lateral lending agency Asian Development Bank ( ADB) for funding activities of the SME units in backward states.

"We are negotiating the agreement of USD 100 million from the ADB. The money will be used for capital expenditure incurred by small and medium enterprises (SMEs) in lagging states like MP, UP, Jharkhand, Orissa, Rajasthan etc", Exim Bank Executive Director N Shankar told reporters here.

Speaking on the sidelines of a conference organised by industry chamber PHDCCI, he said, "We expect the agreement with the ADB to be signed within three months time".

On the contentious issue of payment for oil imports from Iran, Shankar said: "As of now we don't have too much exposure to Iran. But we are discussing with the Reserve Bank and the government officials on how to recover the existing dues".

The problem began after RBI on December 23 last year did away with the Asian Clearing Union ( ACU) mechanism for paying for Iranian crude oil imports, which make up for 12 per cent of the nation's oil needs.

In its effort to facilitate globalisation of trade, Exim Bank has not lost sight of SMEs and agri exporters as they also have the potential to add to India's international trade significantly, Shankar said.

"Our aim is to facilitate the transformation of Indian companies into global corporations. We try to act as a catalyst for boosting India's international trade", he added.