Export Import Bank of India (Exim Bank)

How Did EXIM Bank Of India Come Into The Picture? 

After our economy was liberalised and globalised, the import and export business grew to be a significant contributor to the Indian economy. India has been one of the world’s leading producers and exporters of agricultural products. As a consequence, the Government of India instituted the EXIM Bank to give financial assistance to traders who’re engaged in imports and exports. This is how EXIM bank came into the picture and contributed to Indian growth.

What Is EXIM Bank Of India?

Exim Bank of India is an ideal illustration of a historical organisation for which the notion and demand for such an organisation had been argued for almost twenty years. Significant developments in the manufacturing and commerce landscape occurred in the twenty years preceding the founding of Exim Bank. Basic goods and classic manufacturing (traditional) dominated Indian shipments and exports throughout the 1950s and early 1960s. Although export development chances were restricted while there were inherent restrictions to development and growth in the export segment, the majority perspective would be that in India’s circumstances, growth in consumer spending domestically alone could legitimately function here as the backbone of the Indian trade. The EXIM bank was legitimately working on this objective of import substitution from the very beginning of its origin and simultaneously working on strengthening the Indian industries. 

In the mid of September 1981, this same Export-Import Bank of India Act was established, and the bank came into operation from early March 1982.

What Are The Objectives Of EXIM Bank Of India?

Exim Bank’s goal has shifted from just a perpetual system involving export financing and competence development to a much more adequately addressed with a full variety of commodities to assist organisations at all phases of their trade cycle. EXIM Bank provides loans to traders basically who’ve engaged in exports and imports, as well as serving as the primary commercial bank responsible for monitoring the efforts of implementing agencies in bankrolling the cross-border flow (international trade) of products in order to promote the country’s competitiveness. Over a variety of merchandise, Exim Bank serves as a development driver for enterprises and small-medium enterprises. This comprises technology imports and international research and development, as well as exporting manufacturing, international promotion, prenatal logistics, and investment flows overseas. 

Functions of EXIM Bank India 

There are numerous functions and responsibilities that EXIM banks hold and do for strengthening the international business of India. These are listed below: 

• EXIM Bank also funds the inflow and outflow of products and services from non-Indian nations.
• Owns and controls India’s import and export of merchandise and financially assists the traders.
• It also funds the leasing or structured finance of equipment for the production of import or export commodities.
• In the case of mega projects (multi-funded) in other countries, the EXIM bank can also give business counselling services and specialised expertise to Indian exporters.
• It acts as a merchant bank for importers and exporters in international trade operations.
• Businesses forming a partnership in a foreign nation will also receive financial help from EXIM Bank.
• EXIM bank enables financial institutions with restructuring solutions regarding their international economic finance.

Significance of EXIM Bank India 

Aside from financial aid, the Export-Import Bank of India is continually seeking new ways to enhance India’s overseas trade industry. In the early 1990s, EXIM launched the Clusters of Excellence initiative in India with the same objective. The goal was to raise the efficiency of all international trade to a higher level. EXIM Bank also provides programmes to boost exports, such as precision machining financing, trade promotion credit, capability building funding, and so on.

Conclusion

It’s pretty clear that EXIM bank plays a major role in the development of India stepping out in international trade. Being a developing economy, India needs proper financial counselling and assistance for effective results and this is where EXIM bank of India came into the picture. It brings India’s exports on a major scale where India is contributing to 60% of the world’s exports in terms of agricultural products.