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Exim Bank's $60 mn Line of Credit to Ghana

Current & verified — this is the latest version
Source: Reserve Bank of India · RBI/2005-06/334 · issued 24 Mar 2006 · ~1 min read
Quick answerRBI notifies AD banks of Exim Bank's $60 mn LOC to Ghana for rural electrification and presidential office projects. Exports must use GR/SDF forms; no agency commission is payable, but exporters can pay commission from own/EEFC funds after full payment.
The rule, in the simplest words
How it plays out — a real example

A forex & trade-finance officer in Accra, Ghana, receives a request from an Indian exporter shipping solar panels for the rural electrification project. The officer checks that the exporter uses a GR/SDF form for the shipment and reminds them that no agent commission can be paid from the loan funds. Later, after the exporter gets full payment, the officer approves a commission payment from the exporter's own EEFC account, following RBI rules.

What changed

Exim Bank signed a $60 mn Line of Credit agreement with Ghana, effective February 27, 2006, for financing Indian exports for two projects. The circular outlines utilization periods (48 months for project exports, 60 months for other contracts) and clarifies that no agency commission is payable under this LOC.

What it means for you

Banks must ensure exporters use GR/SDF forms for shipments under this credit and follow existing commission payment rules. The LOC boosts Indian export opportunities in Ghana, but lenders need to verify compliance with FEMA and Exim Bank terms.

What you must do

Who it affects

Authorised Dealer banks handling foreign exchange, Exporters dealing with Ghana under this LOC, Exim Bank and its counterparties

❓ Common questions

Regulatory timeline

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

What are the utilization periods for this credit?

For project exports, the terminal utilization period is 48 months from the scheduled completion date; for other supply contracts, it is 60 months from the date of execution of the agreement (August 23, 2010).

📜 Read the original circular — full text as issued by RBI
RBI/2005-06/334 A.P.(DIR Series) Circular No. 27 March 24, 2006 To, All Banks Authorised to Deal in Foreign Exchange Madam / Sir, Exim Bank’s Line of Credit of US$ 60 Million to the Government of Ghana The Export-Import Bank of India (Exim Bank) has concluded an agreement with the Government of Ghana making available to the latter a Line of Credit (LOC) upto an aggregate sum of USD 60 million (US Dollar Sixty million only). The credit agreement has become effective on February 27, 2006. The credit is available for financing exports from India, of equipment, goods and services for rural electrification Project (USD 30 mn) and construction of Presidential Office (USD 30 mn) in Ghana, which are eligible for export under the Foreign Trade Policy of the Government of India. Full details of the Line of Credit are available at the Exim Bank’s office or its website ( www.eximbankindia.com ) 2. The terminal utilization period under the LOC is 48 months from scheduled completion date of contract in case of project exports and 60 months from the date of execution of the Agreement i.e. August 23, 2010 in case of other supply contracts 3. Shipments under the credit will have to be declared on GR/SDF Forms as per instructions issued from time to time. 4. No agency commission is payable under the above line of credit. However, if required the exporter may use his own resources or utilize balances in his EEFC account for payment of commission in free foreign exchange. Authorised Dealer banks may allow such remittance after realisation of full payment of contract value subject to compliance of prevailing instructions on payment of agency commission. 5. Authorised Dealer banks may bring the contents of this circular to the notice of their exporter constituents. 6. The directions contained in this circular have been issued under Section 10 (4) and 11 (1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and is without prejudice to permissions/approvals, if any, required under any other law. Yours faithfully, Vinay Baijal Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2005-06/334 · issued 24 Mar 2006. The plain-English explanation above is BankPulse’s own independent summary.
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Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (Authorised Dealer banks handling foreign exchange, Exporters dealing with Ghana under this LOC, Exim Bank and its counterparties), your first concrete step on “Exim Bank's $60 mn Line of Credit to Ghana” is: “Inform exporter customers about the $60 mn LOC to Ghana and its project-specific eligibility.” (RBI issued this 24 Mar 2006).

  1. Circular: RBI/2005-06/334 -- Exim Bank's $60 mn Line of Credit to Ghana
  2. Issued: 24 Mar 2006
  3. Action required: Inform exporter customers about the $60 mn LOC to Ghana and its project-specific eligibility.
  4. Action required: Ensure all shipments under this credit are declared on GR/SDF forms as per RBI instructions.
  5. Action required: Remind exporters that no agency commission is payable under this LOC; commission can only be paid from own resources or EEFC after full contract value realization.
  6. Action required: Verify that any commission remittances comply with prevailing RBI guidelines on agency commission.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=2791&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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