Role of Exim Bank for Export Oriented Projects

Presentation by

T C Venkat Subramanian

Managing Director & CEO

Exim Bank, Mumbai

Role of Exim Bank• Closely involved with two-way transfer

of technology, trade and investment. • Promotes international competitiveness

through a range of products and services at all stages of the business cycle: – Import of Technology, – Export Product Development, – Export Production, – Export Marketing, – Pre shipment, – Post shipment and – Investment Abroad.

Strengths of Exim Bank

– Multi-product, diversified organisation constantly striving to reach out to its customer,

– Functions as a facilitator, promoter and partner in quest for excellence, quality and growth.

– Products and services are tailored to meet the needs of different customer groups.• These include programmes for promoting joint

ventures and wholly owned subsidiaries abroad.

Internationalisation Efforts

– Seeks to develop commercially viable relationships with externally oriented companies in order to enhance their internationalisation efforts.

– Enables Indian companies to acquire assets to improve international competitiveness.

International Linkages

• Created a network of alliances with – multilateral agencies, – export credit agencies, – trade and investment promotion bodies,– commercial banks and – financial institutions

• Linkages helps to create an enabling environment to support two-way transfer of technology, trade and investment.

Facilitating Export Oriented Projects

• Participated in export development projects supported by the World Bank.

• Bank had administered an Agency Line of Credit from the International Finance Corporation for technological upgradation of small and medium enterprises. – This was followed by an unprecedented

direct line of credit from IFC.

Export Marketing Finance

• Exim Bank operates Export Marketing Finance (EMF) programmes

• Extends soft loans extended for implementation of strategic export development plans of Indian exporters in targeted industrialised country markets.

Export Marketing Fund

• EMF programme was first introduced in 1986 with an amount of US$ 10 mn - allocated by World Bank to Government of India for grant finance to export oriented firms.

• Finance by way of grants• 180 companies benefited from different

sectors of industry for their overseas marketing activities, including acquiring quality certification such as ISO 9001.

Export Marketing Fund II

• World Bank extended phase II of the programme through Exim Bank

• Finance to 119 companies. • After full commitment of the EMF-II

programme, Exim Bank launched the EMF-III programme in 1992 which included extension of loans and grants.

• Funds drawn from the Bank’s own resources.• The programme has helped a number of

Indian companies in obtaining a variety of quality certifications

To creating export

capability by arranging

competitive financing at

various stages of the export

cycle

From financing,

facilitating andpromoting

India’sforeign trade

To developingcommercially viablerelationships with a

target set of externallyoriented companies by

offering them a comprehensive

range of products and services, aimed at

enhancing theirinternationalisation

efforts

Evolving Vision

Enhances competitiveness through research studies

• Exim Bank periodically conducts studies on select sectors / markets which have export potential.

• Brought put a publication titled “Business Practices of Successful Indian Exporters”.– highlights the reasons for success of Indian

exporters in select sectors and delineate the business practices followed by them.

– This will help other firms to adopt suitable strategies in their globalisation efforts.

Financing of Export - Oriented Companies

Term Loans Guarantees Equity

Software Training Institutes

Minor Ports

Technology Parks

EOU Projects & TUFS

Financing of Export-Oriented CompaniesTerm Loans

Project Finance

Equipment Finance

Working Capital

Overseas Investment Finance

Long Termupto 5 years

Term Loans for 1-2 years

Loans to Indian companies for Equity Investment in their ventures overseas

Loans to Indian companies to onlend to their overseas ventures

Other Programmes

Export Marketing Finance

Export Product Development

Finance for R&D

Short Term < 1 year

Direct Equity stake

Range of Financing Programmes

Overseas Investment Finance

Loans to Indian companies for Equity Investment in ventures overseas

Loans to Indian companies to onlend to their overseas ventures

Examples : Packaging - Indonesia Denim Fabrics - Mauritius Fine Blanking Tools - UK Pharmaceuticals - U.S.A, Ireland Chemicals - Malaysia Glass Bottles - Sri Lanka Phosphoric Acid - Jordan, Morocco Shoes - Singapore Watches - Netherlands Laminated Tubes - China Software - U.S.A., Japan

Exim Bank - Your Equity Partner in Overseas Ventures

Export Marketing Finance• With increasing competitive environment, it is necessary to focus on

greater geographical dispersion through developing new markets

• Exim offers finance for export marketing to Indian companies to implement strategic export marketing plans and invest in supply side upgradation

• These may include desk / field research, minor product adaptation, participation in international trade fairs, overseas travel, training, product launch, brand promotion and investment in supply side upgradation

Examples * Knitting Needles * Polyester Ropes * Home Appliances * Auto Components * Herbal Products * Textiles * Bicycles * Software * Castings * Printing Machinery * Pharmaceuticals * Jute Products

Package for Software Exports

Project / Equipment Finance Working Capital Finance Software Training Institutes Overseas Investment Finance Product / Process Certification Export Marketing Product Development Research & Development

Finance for Export Oriented Companies

Range of Financing Programmes

Overseas Investment Finance

Loans to Indian companies for Equity Investment in ventures overseas

Loans to Indian companies to onlend to their overseas ventures

Examples : Packaging - Indonesia Denim Fabrics - Mauritius Fine Blanking Tools - UK Pharmaceuticals - U.S.A, Ireland Chemicals - Malaysia Glass Bottles - Sri Lanka Phosphoric Acid - Jordan, Morocco Shoes - Singapore Watches - Netherlands Laminated Tubes - China Software - U.S.A., Japan

Exim Bank - Your Equity Partner in Overseas Ventures

Export Marketing Finance• With increasing competitive environment, it is necessary to focus on

greater geographical dispersion through developing new markets

• Exim offers finance for export marketing to Indian companies to implement strategic export marketing plans and invest in supply side upgradation

• These may include desk / field research, minor product adaptation, participation in international trade fairs, overseas travel, training, product launch, brand promotion and investment in supply side upgradation

Examples * Knitting Needles * Polyester Ropes * Home Appliances * Auto Components * Herbal Products * Textiles * Bicycles * Software * Castings * Printing Machinery * Pharmaceuticals * Jute Products

Package for Software Exports

Project / Equipment Finance Working Capital Finance Software Training Institutes Overseas Investment Finance Product / Process Certification Export Marketing Product Development Research & Development

Finance for Export Oriented Companies

• Global Trade Finance Private Limited (GTF), a JV,

promoted by Exim Bank, with WestLB, Germany and

IFC, Washington, commenced business in September

2001.

• GTF’s objective is to promote market driven

export‑financing solutions for small and medium sized

Indian exporters (SMEs) operating in an increasingly

competitive world trade environment.

• GTF offers, for the first time in India, structured

foreign trade financing products such as forfaiting and

factoring.

New Initiatives

Agri Business Group: The Bank has put in place an ‘Agri Business Group’

The Group looks for viable projects and export transactions in agriculture sector.

The Bank has set up an agro-portal, in-house, which is an IT initiative to promote knowledge-based agriculture enterprise.

The Bank brings out a bi-monthly newsletter ‘Agri Export Advantage’ to facilitate information dissemination.

New Initiatives

Export Marketing Service for Indian Companies:

The Bank has launched a new initiative by way of

offering Export Marketing Service for Indian

Companies.

Bank’s network of overseas offices will play an active

role and the services will be offered to well reputed and

quality conscious Indian companies, particularly in the

SME sector, on a success fee basis.

The Bank will serve as a facilitator to help conclude

deals with buyers/importers overseas.

New Initiatives

• EXIM BANK : PROVIDES EQUITY FINANCE

• GUARANTEES FAVOURING BANKS OVERSEAS FINANCING JVS/WOS.• LOANS AGAINST INDIAN PROMOTERS’ LOANS TO JVS/WOS. ACTIVITIES

- Manufacturing - Marketing- Warehousing - Trading

Exim Bank supported setting up of number of overseas joint ventures :

* Sugar - Vietnam * Marketing - Netherlands* Fine Blanking Tools - U.K. * Knitting Needles - Malaysia* Phosphoric Acid - Jordan, Morocco * Watches - Netherlands* Software - U.S.A. * Denim Fabrics - Mauritius* Pharmaceuticals - U.S.A., Uganda

Joint Ventures Overseas

Export Marketing Services

• The Export Marketing services leverage the Bank’s high international standing, indepth knowledge and understanding of the international markets and well established institutional linkages to support a select group of Indian companies in their overseas marketing efforts on a success fee basis.

The Bank aims to promote India’s international trade.

The Logo reflects this. The Logo has a two-way

significance. The import arrow is thinner than the export

arrow. It also reflects the aim of value addition to exports.

Significance of Exim Logo