Cabinet Okays Rs 4,400 Crore Fund Infusion in Export Credit Guarantee Corporation
Government will infuse Rs 4,400 crore in Export Credit Guarantee Corporation (ECGC) and the entity will also be listed through an initial public offer (IPO). The Union Cabinet cleared the proposal on Wednesday to this effect.
Speaking to media persons after the Cabinet meeting, Commerce Minister Piyush Goyal said that ECGC's listing may take place next year. Out of the total Rs 4,400 crore, an amount of Rs 500 crore will be provided to the company on immediate basis, he informed while elaborating on fund infusion in the state-owned entity.
ECGCÂ is governed by the Commerce Ministry and it provides export credit insurance support to exporters.
Fund infusion in ECGC will help the entity to spread is coverage, especially towards labour-intensive sectors. The company is a market leader in the credit insurance segment in the country with more than 80 per cent market share.
The money to be put into ECGC will provide greater legroom to the company while giving insurance cover to exporters. In fact Mr Goyal estimated that it will be able to provide export insurance worth Rs 88,000 crore after this fund infusion.
Apart from this, the Union Cabinet also cleared the continuation of the National Export Insurance Account (NEIA) scheme and a provision of Rs 1,650 crore grant-in-aid for it up to a period of five years.
The fund infusion in this entity will help exploit the potential of exports in key focus areas, the minister said.
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