In order to boost export finance, Commerce and Industry Minister Nirmala Sitharaman has said that Export Credit Guarantee Corporation of India (ECGC) will require an adequate headroom as it provides a range of credit risk insurance covers to exporters against loss in export of goods and services. She said that exports from India suffer due to unmet trade finance needs of as much as $300 billion.
Sitharaman also said that the Ministry will take the issues of ECGC with the Finance Ministry to further strengthen it and will also negotiate with Reserve bank of India so that greater room is given to ECGC because it cannot be too much regulated. She added that at this crucial time the government needs to support exporters to explore newer markets and also need to support the ECGC and strengthen the organization so that it gets the flexibility to operate. She said that exporters need to look at newer markets like Latin America and Africa as demand growth is slow in the traditional markets.
ECGC, wholly-owned by the central government, was set up with the objective of promoting exports by providing credit risk insurance and related services. It also provides overseas Investment Insurance to Indian companies investing in joint ventures abroad in the form of equity or loan.