MANU/APDR/0025/2020

Ministry : Reserve Bank of India

Department/Board : Financial Markets Regulation Department

Circular No. : A. P. (DIR Series) Circular No. 02
                   RBI/2020-2021/49

Date : 08.10.2020

All Category - I Authorised Dealer Banks

Madam/Sir

Exim Bank's Government of India supported Line of Credit of USD 310 million to the Government of the Republic of Zimbabwe

Export-Import Bank of India (Exim Bank) has entered into an agreement dated February 24, 2020 with the Government of the Republic of Zimbabwe, for making available to the latter, Government of India supported Line of Credit (LoC) of USD 310 million (USD Three Hundred and Ten million only) for the purpose of financing repowering of Hwange Thermal Power Station in the Republic of Zimbabwe. Under the arrangement, financing of export of eligible goods and services from India, as defined under the agreement, would be allowed subject to their being eligible for export under the Foreign Trade Policy of the Government of India and whose purchase may be agreed to be financed by the Exim Bank under this agreement. Out of the total credit by Exim Bank under the agreement, goods, works and services of the value of at least 75 per cent of the contract price shall be supplied by the seller from India, and the remaining 25 per cent of goods and services may be procured by the seller for the purpose of the eligible contract from outside India.

2. The Agreement under the LoC is effective from September 30, 2020. Under the LoC, the terminal utilization period is 60 months after the scheduled completion date of the project.

3. Shipments under the LoC shall be declared in Export Declaration Form as per instructions issued by the Reserve Bank from time to time.

4. No agency commission is payable for export under the above LoC. However, if required, the exporter may use his own resources or utilize balances in his Exchange Earners' Foreign Currency Account for payment of commission in free foreign exchange. Authorised Dealer Category- I (AD Category- I) banks may allow such remittance after realization of full eligible value of export subject to compliance with the extant instructions for payment of agency commission.