RBI/2010-11/198
A.P. (DIR Series) Circular No. 12
September 14, 2010
To
All Category - I Authorised Dealer Banks
Madam / Sir,
Exim Bank's Line of Credit (LOC) of USD 25 million to the Eastern and
Southern African Trade and Development Bank (PTA Bank)
Export-Import Bank of India (Exim Bank) has concluded an agreement dated July
27, 2010 with the Eastern and Southern African Trade and Development Bank (PTA
Bank), Kenya making available to the latter, a Line of Credit (LOC) of USD 25
million (USD twenty five million). The credit is available for financing export
of eligible goods and services from India to any PTA Bank regional member
countries viz., Burundi, Comoros, Djibouti, Egypt, Eritrea, Ethiopia, Kenya,
Malawi, Mauritius, Rwanda, Seychelles, Somalia, Sudan, Tanzania, Uganda, Zambia
and Zimbabwe. The goods and services under the Agreement are those which are
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.
- The credit agreement is effective from August 25, 2010 and under the LOC, the
terminal date for opening Letters of Credit will be August 24, 2013 (36 months
from the effective date of the Credit Agreement) and terminal date for
disbursements will be February 24, 2014 (42 months from the effective date of
the Credit Agreement).
- Shipments under the LOC will have to be declared on GR / SDF Forms as per
instructions issued by the Reserve Bank from time to time.
- While no agency commission shall be payable in respect of exports financed
under the above line of credit, Reserve Bank may consider, on merits, requests
for payment of commission up to a maximum extent of 5 per cent of the f.o.b./ c&f /c.i.f. value in respect of goods exported and which require after sales
service. In such cases, commission will have to be paid only by deduction from
the invoice of relevant shipment and the reimbursable amount by the Exim Bank to
the negotiating bank will be 90 per cent of the f.o.b. / c&f/ c.i.f value minus
commission paid. Approval for the payment of commission should be obtained
before the relevant shipment is effected. In other cases, (i.e. exports not
involving after sales service), if required, the exporter may use his own
resources or utilize balances of his EEFC account for payment of commission in
free foreign exchange. Authorised Dealer Category-I (AD Category-I) banks may
allow such remittance after realisation of full payment of contract value
subject to compliance of prevailing instructions on payment of agency
commission.
- AD Category-I banks may bring the contents of this circular to the notice of
their exporter constituents and advise them to obtain full details of the Line
of Credit from Exim Bank's office at Centre One, Floor 21, World Trade Centre
Complex, Cuffe Parade, Mumbai 400 005 or log on to
www.eximbankindia.in.
- The directions contained in this circular have been issued under sections
10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999)
and is without prejudice to permissions / approvals, if any, required under any
other law.
Yours faithfully,
(G. Jaganmohan Rao)
Chief General Manager