Mumbai, May, 11: the export-import bank of India (Exim bank) has entered into an agreement with the Government of the Republic of Mozambique for extending a $ 13 million line of credit for financing for financing Solar Photo Voltaic Module Manufacturing plant in Mozambique.
According to the notification released by the reserves bank of India, the line of credit (loc) is effective April, 23 of this year and the date of execution of the agreement is September 1, 2011.
“Exim bank finances export of eligible goods, services, machinery and equipment including consultancy services for the purpose of financing of Solar Photo Voltaic Module Manufacturing plant in Mozambique....,” the RBI said in its notification.
The Indian goods and services that will be exported under this agreement, including consultancy services, will be limited to items eligible for export under the foreign trade policy of the Indian government.Out of the total credit under this agreement, at least 75 % of the goods and services, including consultancy services, have to be sourced from India. Remaining 25% will be sourced outside India for the facilitation for buyers.
Shipments under the LOC will have to be declared on GR / SDF Forms as per instructions issued by the Reserve Bank from time to time.
According to the apex bank, no agency commission is payable under the above LOC. However, if required, the exporter may use his own resources or utilize balances in his Exchange Earners’ Foreign Currency Account for payment of commission in free foreign exchange.
Authorized Dealer Category- l (AD Category-l) banks may allow such remittance after realization of full payment of contract value subject to compliance with the prevailing instructions for payment of agency commission.
According to RBI, under the loc, the last date for opening of the letters of credit and disbursement will be 48 months from the scheduled completion date of contract in the case of project exports and 72 months (August 31, 2017) from the execution date of the credit agreement in the case of supply contracts.