What changed
Exim Bank signed a new agreement on January 6, 2022, effective April 18, 2022, providing an additional USD 190 million LoC to SBMIDCL. This supplements the existing USD 500 million credit line from May 27, 2017. The LoC requires at least 75% of contract value to be sourced from India, with a specific 30% Indian content requirement for the Metro Express Project.
What it means for you
Banks must facilitate exports under this LoC by ensuring proper documentation and compliance with Indian content rules. No agency commission is payable, but exporters can use own resources or EEFC balances for commission after full export value realization. AD banks need to guide exporters to Exim Bank for detailed terms.
What you must do
- Inform exporter clients about the new USD 190 million LoC to SBMIDCL for Mauritius infrastructure projects.
- Ensure shipments under this LoC are declared on Export Declaration Forms as per RBI instructions.
- Remind exporters that no agency commission is payable; if needed, allow remittance only after full export value realization using own resources or EEFC balances.
- Advise exporters to contact Exim Bank for complete LoC details and terms.
Who it affects
AD Category-I banks, Exporters dealing with Mauritius infrastructure projects, Exim Bank
What is the Indian content requirement for exports under this LoC?
At least 75% of the contract price must be supplied from India, except for the Metro Express Project where the Indian content requirement is 30% of the contract price.
Can exporters pay agency commission on exports under this LoC?
No agency commission is payable. However, if required, exporters may use their own resources or EEFC balances for commission in free foreign exchange after full export value realization, with AD bank approval.