What changed
Exim Bank signed a Government of India-supported Line of Credit agreement with the Kingdom of Eswatini for USD 108.28 million to finance a new Parliament building. The circular outlines the terms, including a 65% Indian content requirement and a 60-month terminal utilization period post-project completion.
What it means for you
Indian exporters can now participate in this Eswatini project under the LoC, with assured financing from Exim Bank. AD Category-I banks must facilitate export documentation and remittances, ensuring compliance with FEMA and Foreign Trade Policy. No agency commission is payable, but exporters can use their own resources for commissions after full export value realization.
What you must do
- Advise exporter constituents about the LoC details and direct them to Exim Bank for complete information.
- Ensure shipments under this LoC are declared on Export Declaration Form or Shipping Bill as per RBI instructions.
- Allow remittance of agency commission only after full realization of export value, using exporter's own resources or EEFC balances.
- Verify that at least 65% of contract value is sourced from India as per the agreement.
Who it affects
AD Category-I banks, Indian exporters of goods and services, Exim Bank
What is the minimum Indian content requirement for this LoC?
At least 65% of the contract price must be supplied by the seller from India; the remaining 35% can be procured from outside India.
Can exporters pay agency commission under this LoC?
No agency commission is payable for exports under this LoC. However, if needed, exporters may use their own resources or EEFC balances to pay commission in free foreign exchange after full export value realization.
Where can exporters get more details about this LoC?
Exporters should contact Exim Bank's office at Centre One, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai 400 005, or visit their website www.eximbankindia.in.