$2.2 Billion US EXIM bank facility for Indian infrastructure projects
United States Ex-Im Bank Chairman and President James H. Lambright signed a Memoranda of Understanding with the Indian Renewable Energy Development Agency (IREDA), Punjab National Bank (PNB) and the Power Finance Corporation (PFC) in New Delhi on May 14, 2008. Chairman Lambright, right, shakes hands with Debashish Majumdar, chairman and managing director, IREDA after signing the agreement. The Ex-Im Bank has approved a $2.2 billion Indian Infrastructure Facility that will support U.S. exports to Indian projects.
The Infrastructure Development Finance Corp., Industrial Development Bank of India, State Bank of India and Infrastructure Leasing & Financial Services are also participating in the facility. Chairman Lambright underscored the rising importance of India to the U.S. export market, saying that India may soon become Ex-Im’s number one customer — ahead of even Canada and Mexico.
Under the facility, eight Indian financial institutions provide their guarantees to expedite processing of Ex-Im Bank-backed medium-term and long-term financing for Indian buyers of U.S. exports. Each financial institution has an underlying pre-approved credit line of $50 to $250 million, and one lender, Power Finance Co., has a pre-approved line of $800 million. Financing provided under the facility is denominated in U.S. dollars.
India’s Ministry of Finance has estimated that more than $500 billion will be needed to finance development of India’s infrastructure. To facilitate financing for U.S. exports for Indian projects, Ex-Im Bank has been working to establish partnerships with business, government and financial institutions in India. In October 2007, Ex-Im Bank Chairman Lambright participated with U.S. Treasury Secretary Henry Paulson in the U.S.-India CEO Forum Infrastructure Investment Conference in Mumbai. Last month, Ex-Im Bank Board Member Diane Farrell and staff conducted business development meetings, focusing on small and medium-sized enterprises, with officials in Hyderbad, Pune, Mumbai and New Dehli.
Ex-Im Bank is the official export-credit agency of the United States. The independent, self-sustaining federal agency, now in its 74th year, helps create and maintain U.S. jobs by financing the sale of U.S. exports, primarily to emerging markets throughout the world, by providing loan guarantees, export-credit insurance and direct loans.
In fiscal year 2007, Ex-Im Bank authorized $12.6 billion in financing to support an estimated $16 billion of U.S. exports worldwide. The Bank approved more than $1.4 billion in financing for U.S. exports to India, including $500 million for U.S. equipment and services to the Reliance petroleum refinery project.
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