What changed
Exim Bank signed a credit agreement with Senegal on December 10, 2004, effective February 9, 2005, for a USD 15 million line of credit. The credit supports Indian exports for rural SME development and agricultural machinery. Letters of credit must be opened by February 8, 2007, and disbursements completed by August 8, 2007.
What it means for you
Indian exporters can leverage this credit to secure payments for eligible exports to Senegal, reducing default risk. Authorised dealers must facilitate documentation and advise clients on Exim Bank's terms. No agency commission is allowed unless exporters use own resources, impacting fee structures.
What you must do
- Inform exporter clients about the line of credit and direct them to Exim Bank for full details.
- Ensure all shipments under this credit are declared on GR/SDF forms as per existing instructions.
- Remind exporters that no agency commission is payable from credit proceeds; they may use own funds if needed.
- Monitor that letters of credit are opened before February 8, 2007, and disbursements by August 8, 2007.
Who it affects
Authorised dealer banks handling foreign exchange, Indian exporters of eligible goods and services to Senegal, Exim Bank
What is the purpose of this line of credit?
It finances Indian exports of eligible goods and services to Senegal, specifically for rural small and medium enterprises and agricultural machinery.
What are the key deadlines for this credit?
Letters of credit must be opened by February 8, 2007, and all disbursements completed by August 8, 2007.
Can exporters pay agency commission under this credit?
No, agency commission is not ordinarily payable. Exporters may use their own resources if such payments are necessary.