Cabinet nod for soft finance by Exim Bank

The union cabinet on Wednesday approved a scheme for provision of concessional finance by the Exim Bank of India in order to make Indian companies more competitive in bidding for infrastructure projects globally.

"The cabinet has approved a scheme for concessional finance support by the Exim Bank to Indian companies so that they may be globally competitive in winning infrastructure projects," Communications and Information Technology Minister Ravi Shankar Prasad told media persons here after a meeting of the Cabinet Committee on Economic Affairs.

Noting that Indian firms with their expertise can be globally competitive in infrastructure building, he said a high-level committee, headed by the economic affairs secretary, would be set up to consider requests for concessional finance from the Exim Bank on a "case-by-case basis".

A finance ministry statement said that this will help Indian companies to bid for large strategically important infrastructure projects abroad.

"The repayment of the loan would be guaranteed by the foreign government," it added.

The committee to decide on financing cases will have members from the departments of expenditure, industrial promotion and policy, financial services and the ministries of commerce, home and external affairs. The deputy national security adviser will also be a member, the statement said.

The projects financed will be monitored by the committee.

"The committee will also consider financing strategic projects through public sector banks other than EXIM Bank on the same terms," said the statement.

"The committee may insist on sourcing of at least 75 percent of the project requirements from India, if it is found compatible with the requests for bids," it added.