Exim India offers over $36 million line of credit to Tanzania

Export-Import Bank of India (Exim Bank) has extended a line of credit to the United Republic of Tanzania, under which it would make available $36.56 million for financing export of 723 vehicles from India to Tanzania.

The credit, being extended under the India Africa Fund, will be available for all eligible exports of goods and services, including consultancy services, from India for the purpose of financing the purchase of the vehicles, an RBI release said today.

The goods and services, including consultancy services from India, for exports 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 the agreement.

To be eligible for the line of credit, at least 75 per cent of the contract price of the goods and services, including consultancy services, should be sourced from a seller in India and the remaining 25 per cent goods and services (other than consultancy services) may be procured by the seller from outside India.

The line of credit is open from 20 May 2011 and the last date for opening of letters of credit and disbursement will be 48 months from the scheduled completion date of contract in the case of project exports and 72 months (27 March 2017) from the execution date of the credit agreement (28  March 2011) in the case of supply contracts, RBI said.

Shipments under the LoC will have to be declared on GR / SDF Forms as per instructions issued by the RBI from time to time.

No agency commission is payable under the LoC. However, the exporter may use his own resources or utilise balances in his exchange earners' foreign currency account for payment of commission in free foreign exchange, RBI added.