LOC facility of Exim Bank sees rapid growth

KOCHI: The lines of credit (LOC) facility offered to overseas buyers by the export-import bank of India (Exim Bank) has witnessed a rapid growth in the last few years

The LOCs enable buyers in developing countries to import developmental and infrastructure projects, equipment, goods and services from India, on deferred credit terms. `` Over the last ten years LOC portfolio has grown exponentially,’’ said A Ajay Kumar, joint secretary (DPA-1), ministry of external affairs.

As of December 31, 2019, Exim Bank has signed 257 LOCs covering 61 countries in five continents with credit commitments aggregating $25.15 billion. Beside these, 41 LOCs amounting to $5.50 billion are in the pipeline. The total commitment will then rise to 298 LOCs of $ 30.62 billion to 64 countries over the world, he added.


Currently, around 52% and 41% of the total LOC commitments are to Asia and Africa Regions, respectively. In terms of total number of LOCs extended, Africa is the largest recipient Region. Value-wise it is the Asia Region that is leading because of a few high-value LOCs to our neighbouring countries, said Sudatta Mondal, chief general manager of Exim Bank. The total outstanding loan balance under the LOCs as on December 31, 2019, stood at $ 5.63 billion.

They were in Kochi to participate in seminar on business opportunities Exim bank’s LOC for exporters from Kerala

The Indian companies benefit from the program as a minimum 75% of the value of goods and services covered under the LOC programme are typically sourced from India, and Exim Bank assumes the credit and political risks of the overseas buyers.