JBIC extends $330-mn credit line to Reliance Industries

The Japan Bank for International Cooperation (JBIC) has extended a syndicated loan of up to $330 million to set up an export credit line with Reliance Industries Limited (RIL) in India.

This is the first time for JBIC to extend loan to RIL.

The credit line is co-financed up to $220 million with The Bank of Tokyo-Mitsubishi UFJ Ltd (the lead arranger), Sumitomo Mitsui Banking Corporation, Mizuho Bank Ltd, The Gunma Bank Ltd, The Hachijuni Bank, Ltd and The Chiba Bank Ltd.

The overall cofinancing adds up to $550 million.

Nippon Export and Investment Insurance (NEXI) provides insurance for the portion cofinanced by private financial institutions.

RIL will use the line of credit to expand the production capacities of a petcoke gasification plant, a paraxylene plant and an ethylene production plant, including downstream units (all in Jamnagar), purified terephthalic acid (PTA) production plant (Dahej), synthetic rubber production plant (Hazira), and a polyester filament yarn production plant (Silvassa).

The credit line will finance RIL's procurement of goods and services related to these oil refining and petrochemical plants from multiple Japanese companies in expanding their capacities.

JBIC said the financial support provided it and the co-financing by Japanese private financial institutions, including local banks, for the export of facilities related to the oil refining and petrochemical plants will help create business opportunities for Japanese companies, including mid-tier enterprises and small and medium-sized enterprises (SMEs), in India's petrochemical sector.

The long-term nature of financing will also contribute to maintaining and improving the international competitiveness of Japanese companies, JBIC said.