RBI/2019-20/119 A.P. (DIR Series) Circular No. 13
December 19, 2019
All Category – I Authorised Dealer Banks
Madam/Sir
Exim Bank's Government of India supported Line of Credit (LOC) of USD 23
million to the Republic of Zimbabwe
Export-Import Bank of India (Exim Bank) has entered into an agreement dated
April 04, 2019 with the Republic of Zimbabwe for making available to the latter
a Government of India supported Line of Credit (LoC) of USD 23 million (USD
Twenty Three Million only) for the purpose of financing renovation/upgradation
of Bulawayo Thermal Power Plant at the revalidated/escalated project cost, in
the Republic of Zimbabwe. Under the arrangement, financing of export of eligible
goods and services from India, as defined under the agreement, would be allowed
subject to their being eligible for export under the Foreign Trade Policy of the
Government of India and whose purchase may be agreed to be financed by the Exim
Bank under this agreement. Out of the total credit by Exim Bank under the
agreement, goods, works and services of the value of at least 75 per cent of the
contract price shall be supplied by the seller from India, and the remaining 25
per cent of goods and services may be procured by the seller for the purpose of
the eligible contract from outside India.
2. The Agreement under the LoC
is effective from November 26, 2019. Under the LOC, the terminal utilization
period is 60 months after the scheduled completion date of the project.
3. Shipments under the LoC shall be declared in Export Declaration Form as per
instructions issued by the Reserve Bank from time to time.
4. No agency
commission is payable for export under the above LoC. However, if required, the
exporter may use his own resources or utilize balances in his Exchange Earners’
Foreign Currency Account for payment of commission in free foreign exchange.
Authorised Dealer Category- I (AD Category- I) banks may allow such remittance
after realization of full eligible value of export subject to compliance with
the extant instructions for payment of agency commission.
5. AD Category
– I banks may bring the contents of this circular to the notice of their
exporter constituents and advise them to obtain complete details of the LoC from
the Exim Bank’s office at Centre One, Floor 21, World Trade Centre Complex,
Cuffe Parade, Mumbai 400 005 or from their website www.eximbankindia.in
6. The directions contained in this circular have been issued under section
10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999)
and are without prejudice to permissions/ approvals, if any, required under any
other law.
Yours faithfully
(R K Moolchandani) Chief General Manager
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