**Summary:**
This circular (RBI/2017-18/125 A.P. DIR Series Circular No. 17) issued by the Reserve Bank of India on January 25, 2018, informs all Category I Authorised Dealer banks about a Government of India-supported Line of Credit (LoC) of USD 71.40 million extended by the Export-Import Bank of India (Exim Bank) to the Government of Côte d'Ivoire. The agreement, effective from December 15, 2017, is for financing the Upgradation of four Military Hospitals in Abidjan, Korhogo, Bouake, and Daloa regions in Côte d'Ivoire.
The LoC facilitates the export of eligible goods (plant, machinery, and equipment) and services (consultancy services) from India, as defined under the Foreign Trade Policy of the Government of India. A minimum of 75% of the contract price for goods and services must be supplied by the seller from India; the remaining 25% may be procured from outside India.
The terminal utilization period for the LoC is 60 months after the scheduled completion date of the project. Shipments under this LoC must be declared on the Export Declaration Form, as per RBI's instructions. No agency commission is payable for exports under this LoC. However, exporters may use their own resources or Exchange Earners Foreign Currency Account balances for commission payments in free foreign exchange, subject to existing regulations.
Authorised Dealer Category I banks are advised to inform their exporter constituents about the LoC and direct them to obtain detailed information from Exim Bank's office at Centre One, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai 400 005, or from their website www.eximbankindia.in.
The directions in this circular are issued under Section 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999, and are without prejudice to other applicable laws.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for issuing and managing the Indian currency and regulating the banking system.
Mumbai, Maharashtra: The city in India where the Reserve Bank of India is located.
Exim Bank: Export-Import Bank of India, an Indian financial institution that facilitates international trade.
Government of Cte d'Ivoire: The governing body of Cte d'Ivoire, the recipient of the Line of Credit.
Line of Credit: A line of credit (LoC) of USD 71.40 million from Exim Bank to the Government of Cte d'Ivoire.
Abidjan: A city in Cte d'Ivoire where military hospitals are being upgraded as part of the agreement.
Foreign Trade Policy of the Government of India: The export guidelines and regulations established by the Indian government.
Foreign Exchange Management Act FEMA, 1999: An Act of the Parliament of India to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.
RESERVE BANK OF INDIA
________________________________Mumbai – 400 001______________________________
RBI/2017-18/125
A.P. (DIR Series) Circular No.17 January 25, 2018
All Category – I Authorised Dealer Banks
Madam/Sir
Exim Bank's Government of India supported Line of Credit of USD 71.40 million to
the Government of Côte d’Ivoire
Export-Import Bank of India (Exim Bank) has entered into an Agreement on May 22,
2017 with the Government of Côte d'Ivoire for making available to the latter, a
Government of India supported Line of Credit (LoC) of USD 71.4 million (USD Seventy
one million four hundred thousand only) for the purpose of financing the Upgradation of
four Military Hospitals in Abidjan Korhogo, Bouake and Daloa regions’ in Côte d’Ivoire.
Under the arrangement, financing export of eligible goods and services from India would
be allowed which are 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. The goods include plant, machinery and equipment and
services include consultancy services. Out of the total credit by Exim Bank under this
agreement, goods 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 December 15, 2017. Under the LoC,
the terminal utilization period is 60 months after the scheduled completion date of the
project.3. Shipments under the LoC will have to be declared on Export Declaration Form as per
instructions issued by 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 its own resources or utilize balances in its 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.
5. AD Category – I banks may bring the contents of this circular to the notice of their
exporter constituents and advise them to obtain full details of the LoC from the Exim
Bank’s office at Centre One, Floor 21, World Trade Centre Complex, Cuffe Parade,
Mumbai 400 005 or from their website www.eximbankindia.in
6. The directions contained in this circular have been issued under section 10(4) and
11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are
without prejudice to permissions/ approvals, if any, required under any other law.
Yours faithfully
J K Pandey
Chief General Manager