Exim Bank’s Line of Credit to Banco de Comercio
AP (DIR Series) (2001-2002) Circular No. 52 Dated 25-6-2002
Exim Bank’s Line
of Credit of US $ 10 million to Banco de Comercio Exterior de Colombia, S.A. (Bancoldex), Colombia
Export
Import Bank of India (Exim Bank) has concluded an agreement with the Banco de
Comercio Exterior de Colombia, S.A. (Bancoldex), Colombia on February 5, 2002,
making available to the latter, a line of credit upto an aggregate sum of US $
10 million (U.S. Dollar Ten Million only). The credit has become effective from
March 21, 2002, and is available for financing Indian export of eligible goods
(listed in the Annexure) and related services to buyers in the borrower’s
country i.e., Colombia or any other country as may be requested by the
buyer and approved by the borrower except to a country with which India may not
have bilateral relations or on which any sanctions or embargo may have been
imposed. The eligible goods will also include initial spares, drawings and
designs together with services related thereto. The export of goods from India
and their import into the borrower’s country shall be subject to the laws and
regulations in force in both the countries.
2. The broad
terms and conditions of the credit are as under:
a. Every contract under the credit will
require prior approval of Exim Bank.
b. The
credit shall be available for financing an amount upto 90 per cent of the
f.o.b. (free on board) or c.&f. (cost and freight) or c.i.f. (cost,
insurance & freight) contract price of the eligible contract.
c. The
contract price shall be specified in U.S. Dollar and shall not be less than
U.S. Dollar 50,000 (U.S. Dollar Fifty Thousand only) or such amount as may,
from time to time, be agreed upon between Exim Bank and the borrower.
d. The
contract signed under the credit should also provide for the following :
i. The
buyer shall make an advance payment of 10 per cent of the
f.o.b./c.&f./c.i.f. contract value to the seller within 10 business days
after the date of the approval of the contract by Exim Bank.
ii. The
buyer shall make payment to the seller of the balance 90 per cent of
f.o.b./c.&f./c.i.f. contract price, pro rata against shipments to be
covered under an irrevocable letter of credit in favour of the seller.
iii. The
eligible goods shall be inspected before shipment on behalf of the buyer and
the documents to be furnished by the seller to the negotiating bank under the
letter of credit arrangement shall include an inspection certificate.
3. The
letter of credit shall be advised through such offices of the negotiating bank
in India as may be designated from time to time by Exim Bank in consultation
with Bancoldex. The letter of credit shall be subject to the Uniform Customs
and Practice for Documentary Credits (1994 edition) published by the
International Chamber of Commerce (Publication No. 500) and shall be
irrevocable and if required by a seller, be also divisible and transferable.
4. Upon
presentation of documents by the beneficiary to the negotiating bank, the
negotiating bank shall pay to the beneficiary an amount being not more than 90
per cent of f.o.b./c.& f./c.i.f. contract value, apportionable to the
relative shipment, in equivalent Indian Rupee at the spot rate of exchange of
the negotiating bank, provided the documents presented are in order and are in
conformity with the relevant letter of credit.
5. Where
negotiation has been effected without reserve, Exim Bank shall, upon receipt of
the negotiating bank’s written communication, reimburse the negotiating bank in
U.S. Dollar with the amount of the eligible value to the extent apportionable
to the relative shipment by transfer to the credit of the negotiating bank in
such account with such bank in New York, USA, as may be specified by the
negotiating bank in the communication to Exim Bank. If the negotiation has been
made under reserve, Exim Bank shall make payment to the negotiating bank only
after Exim Bank receives a written communication from the negotiating bank that
the issuing bank which has opened/issued letters of credit, has lifted the
reserve and has accepted the documents, or a communication from the issuing
bank through the borrower or the negotiating bank to that effect.
6. Bank
charges, expenses, commission or stamp duty payable in India shall be to the account
of the seller/beneficiary and those payable in the borrower’s country shall be
to the account of the buyer.
7. Exporters
should check with Exim Bank, in advance, before finalising the contract with
the buyers, details of service fee payable by the exporters on the contract to
be covered under the above Line of Credit.
8. The
terminal dates for opening letters of credit and utilisation of credit are
March 20, 2003, and September 20, 2003, respectively.
9. Shipments
under the credit will have to be declared on GR/SDF Forms as usual. All copies
of the GR/SDF Forms should bear a prominent superscription reading ‘Export
under Exim Bank’s Line of Credit dated February 5, 2002 extended to Banco de
Comercio Exterior de Colombia, S.A. (Bancoldex), Colombia’. The number and date
of this circular should be recorded in the space provided for. On receipt of
full payment of the bills in the manner stated above, authorised dealer should
certify the duplicate copy/ies of the relative GR/SDF Form/s and forward them to
the concerned Regional Office of the Reserve Bank, in the usual manner.
10. No
agency commission shall be payable in respect of exports financed under the
above line of credit. However, Reserve Bank may consider on merit, requests for
payment of commission upto a maximum extent of 5 per cent of the f.o.b./c.&
f./c.i.f. value in respect of goods specified in the Annexure and which require
after sales service. In such cases, commission will have to be paid in the
borrower’s/buyer’s country only by deduction from the invoice of the relevant
shipment and the reimbursable amount by the Exim Bank to the negotiating bank
will be 90 per cent of the f.o.b./c.&f./c.i.f. value minus the
commission paid. Approval for payment of commission should be obtained before
the relevant shipment is effected.
11. Authorised
Dealers may bring the contents of this circular to the notice of their
concerned constituents.
12. The
directions contained in this circular have been issued under section 10(4) and
section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999).
List of Eligible
Goods for finance out of the Credit
1. Air compressors
2. Air conditioning, heating, cooling,
fume extraction, dust collection, humidification and ventilation equipment for
industrial use including blowers and exhaust fans.
3. Alcohol and brewery plant
4. Aluminium plant and equipment
5. Asbestos cement machinery
6. Cement machinery
7. Cinematographic equipment for motion
picture and television studios
8. Chemical and pharmaceutical plant and
machinery
9. Cigarette making machinery
10. Coffee processing machinery
11. Coke oven plant and equipment
12. Coke oven refractories
13. Control and Process Instruments including
X-Ray equipment for Industrial Applications.
14. Copper Ore concentration machinery
15. Dairy equipment and animal feed plant
16. Earth moving equipment like crawler
tractors, shovels, excavators, loaders, dumpers etc.
17. Edible Oil Mill machinery and oil
expellers
18. Electric motors and pumps
19. Electronic Data Processing equipment
20. Fertilizer plant and equipment
21. Flour, rice and dal mill machinery
22. Food processing plant
23. Foundry equipment including mould making
machinery, Sand and Shot blasting equipment
24. Freight containers
25. Garage equipment
26. Gas and air separation plants
27. Glass and Ceramic machinery
28. Heat Exchangers
29. Integrated Steel Plants (complete or in
parts), mini steel plants (electric arc and reduction furnaces). Reheating and
heat treatment furnaces, Rolling Mills and other finishing lines for ferrous
and non-ferrous metals.
30. Ice-making machinery
31. Industrial boilers
32. Industrial furnaces
33. Industrial switchboards, Control panels,
circuit breakers, air break switches
34. Jute machinery
35. Leather tanning and processing machinery
36. Machine tools
37. Machinery for manufacturing air
conditioners, bicycles, corks, electrical goods, enamel-ware, hard board, metal
containers, radios, razor blades, refractories and bricks, sewing machines
shoes, steel furniture, wire-ropes and cables etc.
38. Machinery for manufacturing any product
figuring in Part B of this List, not specified separately in this Part.
39. Material handling equipment like fork
lifts, electric lifts, cranes, hoists etc. and conveyor systems.
40. Metal working machinery
41. Mining machinery
42. Motor vehicles and chassis, including
three-wheelers
43. Oil drilling rigs
44. Oil refinery equipment
45. Packaging and weighing machinery
46. Pile foundation machinery
47. Plastic machinery
48. Power generation, transmission and
distribution equipment including boilers, generators, transformers,
switchgears, transmission line towers, conductors, cables, sub-station equipment
and protective equipment
49. Power line carrier communication
equipment
50. Power station structures, hydraulic
structures like penstocks, gates and gearings, sub-station structures.
51. Pressure vessels
52. Printing and book-binding machinery
53. Pulp and Paper Mill machinery
54. Railway electrification equipment and
structures and railway signalling equipment
55. Railway rolling stock including
locomotives, wagons, coaches and trolleys
56. Rubber machinery
57. Road and construction equipment including
road-rollers, tar boilers, continuous batch plants, stone crushers, asphalt
mixers, concrete mixers and vibrators
58. Ships, boats, trawlers, steamers,
launches, barges
59. Solvent extraction machinery
60. Spraying equipment
61. Steam, diesel and petrol engines
62. Steel fabrication for bridges, factories
etc.
63. Steel rails and railway track equipment
including sleepers, fishplates, points and crossings
64. Steel shuttering and scaffolding
materials
65. Steel tanks
66. Sugar (including Khandsari) machinery
67. Telecommunication and signalling
equipment
68. Textile machinery
69. Tractors and Trailers
70. Vending machines
71. Water supply equipment including pumping
plant, large diameter fabricated steel pipes, C.I. spun pipes and storage
tanks, water treatment and sewage treatment plant
72. Weigh bridges
73. Welding machinery
74. Wood working machinery
1. Agricultural implements
2. Auto parts
3. Bicycles, motorcycles, scooters, mopeds
and parts
4. Construction materials including
sanitaryware, tiles and precast cement products, false ceiling, flooring
materials, pipes, decorative laminates, fittings, electricals and
steel/aluminium doors and windows, provided they are exported as separate items
and not as items forming part of civil construction/turnkey projects
5. Agricultural chemicals and industrial
chemicals
6. Pressure cookers, watches and clocks,
knitting/sewing machines, vacuum flasks, cutlery, plastic moulded luggage
7. Domestic electric appliances
8. Drugs and pharmaceuticals
9. Electrical equipment including low
tension insulators, batteries and accumulators, parts of electrical machinery
and lamps, fuses and electrodes for industrial application
10. Electronic components
11. Electronic goods including radios, TV,
public address systems, record players, tape recorders
12. Fiberglass, PVC and plastics based
products including pipes and tubes, tyre cord
13. Ferrous/non-ferrous castings, forgings,
stampings, extrusions and rolled products
14. Ferrous/non-ferrous pipes, tubes, sheets,
strips, foils, rods, wires, wire ropes
15. Heating and cooling equipment including
air conditioners, refrigerators, water coolers
16. Industrial rubber products including
tyres and tubes, cots and aprons, conveyor belts, rubber rollers, hose pipes
17. Instruments for measurement, scientific
survey and for surgical applications
18. Industrial fasteners, bearings, valves,
gears and gaskets
19. X-ray and other electro-medical and other
hospital equipments
20. Office equipments including typewriters,
calculators, duplicators, teleprinters
21. Metal and plastic furniture
22. Hand tools, cutting tools, grinding
wheels, moulds, dies
23. Gas Cylinders, fire fighting equipment,
photographic equipment, helmets, including fiberglass helmets
24. Any item not included in Part ‘B’ above
that might be agreed to be financed by Exim Bank at the request of the
Borrower.