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The Export Credit Guarantee Corporation (ECGC) of India Ltd. has settled a record number of claims from exporters involving 978 cases for Rs.352.28 crore on the fast track during 2004-05. ECGC, which is the country’s premier organisation under the Ministry of Commerce & Industry offering credit risk insurance cover to exporters, banks etc., also recorded the highest ever profit (before tax) of Rs.144.59 crore during 2004-05. This was indicated during a performance review of ECGC taken by the Commerce & Industry Minister, Shri Kamal Nath, here recently.
The government has provided Rs.100 crore to ECGC as additional equity support during the current year, which has enabled the Corporation to reduce rates of premium for exporters. This is in addition to Rs.200 crore which is budgeted for 2005-06 after the setting up of the National Export Insurance Account is approved and operationalised which is expected to give a big boost to India’s project and services exports. Shri Kamal Nath indicated that a separate fund with a corpus of Rs.2000 crore called the National Export Insurance Account had been under active consideration of the government and would to be taken to the Cabinet Committee on Economic Affairs soon. The fund would extend support in respect of exports involving large value projects with credit terms which are unconventional and those beyond the underwriting capacity of ECGC. The fund would also enable exports to countries facing persistent economic and financial difficulties.
Meanwhile, six new policies with simplified procedures and reduced premium rates have been introduced by ECGC to meet specific needs of exporters, and 9 countries were upgraded resulting in lower cost for exporters.
ECGC’s primary objective is to promote country’s exports by covering the risk of exports on credit by providing: (a) insurance cover to Indian exporters against non-realisation of export proceeds due to commercial or political risks; and (b) guarantee to banks and other financial institutions to enable them to extend credit facilities to exporters on liberal basis.
SB/MRS
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