‘CHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADECHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE, ee INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE “The Government of India set up the Export Risks Insurance Cosporation (ERIC) in July 1957 in order to provide export credit insurance support +0 Indian exporters. It was transformed into Export Credit 8 Guatnaree Comporition Limited (BCGQ ia 1964. To boing the Tian identity into sharpec focus, the Cosporation’s name was once agsin changed to the present Export Credit Guarantee Corporation of India Limited in 1983, ECGC is a company wholly owned by the Government of Inds. Ie functions under the seministative coateol of the Ministry of Commerce and is managed by a Beant of Directs representing Government, Banking, Insurance, Trade, Industry, et. Export Credit Guaraarce Corporation of India Limi was established in the yeu 1957 by the Gaveenment of Inca to strengthen the export promotion drive by eovering the sk of exporting on eset. Being essentially an expert promosion orpinisation, it functions bundet the administrative control of the Ministy of Coramerce, Government of Indi, FCGC is dhe fifth largest credit insurer of the world in terms of coverage of national exports. "The present paid-up expical of dhe company is Rs.390 crores, which was expected to be enhanced 9 R500 crores by the year 2002. Functions of ECGC CGC provides a range of eredic risk insurance covers to exporters against loss in export of goods and services. It offers guamatees to banks and Gnancial instinutions to enable B01 a exporters to obtain better facilites ftom them, It provides Overseas Investment Tov Tndian companies investing in joint ventures abroad in the form of equity or loan, ‘The ECGC helps the exporters in the ander mentioneel ways (Tt provides insurance protection to exporters against payment sss. le provides guidance in export elated activites. (®__Itprovides information 0 eredit-worthiness of overseas buyers. (—_Ieprovides information on about 180 counties with its own credit ratings. (© Temakes i easy to obvain export finance from banks/ financial instivations, (© Ieassises exporters in recovering bad debss. “The covers issued by ECGC can be divided into four groups (1) Standasd policy: Itis issued to the exporters to protect chem aginst payment risks involved in exports made on short-term ctedit. The policy is issued for the same pamose to the exporters with small exports. SS oeCHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE CEE er (@) Specific policies: These ate designed to proveet Indian fiems against payment risks of Joss involved in: {2} Bsporc on deferred ves of payments, {b) Services endered 1 Foreign paris and (9 Construction works and curn key projects undertaken a broads G) Financial guarantees: These ste issued to banks in India to protect chem from the loss involved in their extending financial support to exposters at the pre-shipment as well as post shipments stages: and (Special schemes: They ate many special schesnes lke Transfer gus ntee (meant £0 protect banks which hed confirmed lerters of credit opened by foreign banks); insurance cover for buyer's exedit, line of credit, oversens investment insurance and exchange fluctuation tsk insurance. ‘The above policies ate heing discussed in derail (0 Standard Policy: ‘The commonly known as the standard policy is the Shipments (Comprehension Risks) Policy. It isthe one ideally suited to cover risks in respeet of goods exported on shor tenn credit, ie. credit not exceeding 180 days. ‘This policy covers both commercial and politcal rks from the date of shipment, Its issued to exporters whose anticipated export turaoser for the next 12 months is mote then RAS) Lakhs. (The appropriate poliey for exporters with an anveipated tumover of less than Rs.50 lakhs isthe Smal porters Policy) Risks covered under the policy: Under the Shipments (Comprehensive Risks) Policy, the Corporation covers, from the date of shipeent, the following risks G@) Commercial Risks: (b)_ Insolvency of the buyer ())__Vatlare of the buyer to make the payment due within a specified period, normally 4 mnanths From the due date, (9 Boyer’ failure to accept the goods, subject to certain conditions. Political Ris (@ Imposition of restiction by the Government of the buyet’s counuy or any Government action, which may block o delay the eransfer of paymenc made by the buyer. i}CHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE ee () War, civ war, revolution oF civil diseurbances inthe buyer's country (© Now import restrictions or cancellation of a valid import license. (@)—Intesnsption or diversion of voynge outside India resulting in payment of tuldiional fheight or insurance charges which, eannot be recovered from the buyer. © Anyother cause of loss cccurring outside India, not normally insured by general insurers, and beyond the control of both the exporter and the buyer. Shipments Covered: ‘The shipments (comprehensive sishs) policy is meant ro cover all the shipments dhat may be made by an exporter, on credit terms during a period of 24 months ahead, In other swords, an exporter is required co get the insurance as provided by the Policy for each and covery shipment that may be made by him in the next 24 months on DP, DA ot Open Dativery tems to all buyers other than his own associates, The policy cannot be issued for selected shipments, selected buyers or selected markets Shipments against letters of credit: Unless they are congiemed by banks ia India, payment under irrevocable Letters of Ceodit are subject to political risks, Exporters, therefore, get them also covered under the pplicy. Such shipments, which are excluded from the scope of the policy, ean be covered under it iF an exporter se desices, Lower preminm rates are applied vo them because they do, not involve commercial ssks and only the politcal crisis has to be covered. For shipments made against inrevoeable Letters of Credit, an exporter has an option to obuain either political risks cover only, ot cover for comprehensive risks, Le, for all poli dss and the ssk of insolvency of default of the bank opening the irevocsble Leter of Credit. In either ease, cover will be provided by the Corporation only if the exporter agrees to get all the shipments made against irevocable Leiter of Credit covered tnder the policy, Cover will not be availble for selected transactions ‘Shipment to associates: Shipments to associates Le, foreign buyers in whose business the exporter has a Financil interest, ate normally excluded feom the policy. They ean, however be, covered against policical risks under the policy, if an exporter so desires. White the associate is a public limited company, in which the exporter’ shage folding does not exceed 40%, cover can be provided against insolvency risks in addition tall che poli! sks Shipments on consignment basis: —_—_—_—_———— MmCHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE SS eee Shipments which ere made to an pvemeas agent under ap agreement that he wil receive the goods as an agent of the exporter and remic dhe proceeds on the seis being sold by him, are exchided from the scope of the policy However, if an exporter wanes i, the Corporation can got thet inchided under the poli. Cover will be provided only against pola css, since de agent acts for the exporter. IF however, good ate sold to okimate buyers on ctedc terns, comprehensive risks cover ean be provided for sles to such ulkimare buyer if che exponte wants such cover Shipmems made by ait: ‘Where shipments are made by air, the buvers are often able to obtain delivery of the goods from the silines before making paymeat of the bills or aceeping them for payment, 4s the ease may be If the buyer fils to make the payment subsequently a8 pee the contre, the disk of loss will aor be covered under the policy if premiun has been paid on the shipment for DP or DA terms of payment. An exporter credit linc on such buyers on Open Delivery toms and also pays presnium st rares appliable to Open Delivery terms. Additional cover for shipments to government buyers: All shipments made to Government bujess are covered under the policy against political risks. The exporter has, therefore, ro declare such shipments 10 the Comporation and py protiuan a¢ rates applicable for covering political ssks, The Corporation's specific approval should be obtained where the counsay is in the list of resized cover counties “This cover does not extend co commercial risks like default or non-acceptance of goods. If an exporter wants these risks ako to be covered, then he should write to the Corporation, ashing thae tsk umber (XI) described ia the policy be also covered In his letter, she cesporter should give information abour nume and address of the buyer, the status of he ‘bayer and the deals of the conaact. If the Corporation approves dhe request, the shipment concczned will be covered against compzehonsive rich, if dhe eapomer pays presivi on those shipments at rates applicable for comprehensive sks. It may be noted chat Cozpotation will consider the following as Government Buyers (@— Adeparement of the Central Government and @— Wthebs ‘or Government owned Corporation Companies, if the performance of the yer be a Government body like a Board, State Government, Municipality contoret is puaranteed by the Central Government 12CHAPTER - V INSURANCE AND FINANCING OF INDIA’S POREIGN TRADE “The Standard Policy proves cover only for the post shipment stage, ie fom the date of shiprnent. Cover for pre-shipment losses ic. Josses which may be sustained by an caponet due 10 impossibility of exporting goods already manufactured o& purchased for reasons like ban on esport ofthe iem, restctions on impore of the items into the buy’s county of wat, ci wt, ete, ace noc covered nde the policy becuse the tsk is wer low in respect of raw mater, primary produets, consumer good or consumer durables whieh can casiy be sold Where however, the export involves an item which is manufiesurd tothe somstandard specifications of bayer, cover can be provided forthe pre-shiomenc iss by scans of an endorsement eo the standard policy. Shipments made on credit exceeding 180 days: ‘The policy is meant co provide cover for shipments involving a credit peciod not exceeding 18) days. In exceptional ease, however, cover may be granted for shipments with longer credie period, provided that such longer credits are jusiiable for the export items concerned. (Il) SPECIFIC POLICIES: ‘The Standard Policy is a whole tumover policy designed to provide a continuing insurance for the regular Dow of an exporte’s shipments of saw smiterials, consumer goods and consumer dutebles for whieh exedir pesiod does not exceed 180 days. Contracts for spor of espital goods or turnkey projcets or construction works or rendering services abroad are not of repetitive nature and they involve medium/long-cerm cred. Sock transactions ate, therefote,insated by ECGC on a ease-to-case basis under specific policies. All contracts for export on defesed payment terms and contracts for suunkey projcees and constnition works abroad rsquise prior clearance of auorced dealers, EXIM Bank ofthe Working Group in tomas of passers delepated to them as per exchange control regulations. Applications for the purpose ate co be submitted to the authorised dealer (the financing bank) which will forward applications beyond its delegated power to the EXIM Bank. Proposals for Specific Policy are to be made 19 ECGC after the contract has been cleared by the authorised dealer, EXIM Bank or the Working Group, as the ease my be Specific Policy for supply conteaets may take any of the following forms: © Specific Shipment (Comprehensive Risks) Policy (i) Specitie Shipenents (Political Risks) Polley —S—. M3CHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE oo @ ‘Contract (Comprehensive Risks) Policy and &) Contract (Political Risks) Policy Specific Shipments (Comprehensive Risks) Policy provides cover against all dhe tisks covered under the 5 1lard Policy in respect of shipments to be made under the contract in «question. 1 vil therefore, be the appropriate policy for an exporter to take i the payments are open co both commescial and poliicalsshs, Where the commercial sks are absent, 68. ‘where the payments ure guaranteed by a banks or by the Government of the overseas country, the exporter may opt forthe Shipments (Political Risks) Policy for wich the Premiusn rate ‘ill he lower than that for the Comprehensive Risks Policy Contract Policy differs from Shipments Policy in that the former provide the exporiee not only with post-shipment caver that a shipments Poliey provides but also with some pre- shipment cover. in case shipments could not be made due t0 any of the risks covered or due to sestiction om export of the goods from Incl, the loss in respect of unshipped goods will ako be covered under eontmet Policies. Premium rates for contract policies will be higher «han for shipments policies. ‘To be eligible for cover under specific policies, the terms of payment for the export contracts should be in line with customary practices in the international maskets. At least 15% of the contract value should be pasable before shipment including an advance payment of at least 5% ‘The balance amount should be repeybale in equal semi-anval instalments commencing six months afice the date of shipment oF mean date of shipment. Where the contract provides for supply and exceion of a complete plant, the frst instellmeat sna fll due afer six months From the date of commnssioning of the plant. The exedit period should sot nosinally exceod 5 yeass, Longer credit period! may be approved only in the case of cexceptiomally lange projets if the circumstances of she ease justify it Adequate security should be obtained in the form of government guarantee or bank guarantee. In omder to be sure of the cover, exporters should get inprinciple approval of the Corporation and obtain he premium rates well before concluding contracts, Ihe terms and conditions undergo any change subsequendy, the Corporation should be kepe informed of the same. Specific Policies ate issued if the Corporation approves proposals whiel are co be made fon the forms specified for the purpose, ‘The entre premium is payable ia advance. Installment facility may be granted for payment of a past of the premium if the contact ‘value ie very Inge and ifthe shipments ate spread over a relatively long period, but the entre uaCHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE _ ‘preminm will have to be paid by the time the lase shipment it made Interest will be charged for the installonene facil. Insurance Cover for Buyer's Credit and Line of Credit Buyer's Credit is a eredic extenced by a bunk in India to an overseas buyer for the specific purpose of enabling the buyer to pay for machinery and cquipments that he may be importing from Indi for a specific projec A Line of Credit isa credit extended by a bank in India to an overscas bank, institution of governmene for the purpose of faiiating impost of ‘variety of listed goods from India into the oveescas country. A number of imporcers in dhe overseas country may be importing the goods under the Line of Cre. CGC has evolved schemes to protcer the lending banks from certain risks of ronpayment. ‘These cavers take the form of an agecement berween the lending ban’: and TECGC and are issued om a case-to-case bass To be dligile For cover, a Buyer's Ctedit-or a Line of Credit should cot be higher than 85 % of the valve of che goods to be exported. Credit terms and the length of the credit period should be in conformity with what is appropriate for the export of the items to be exported. There should be adequate secusicy for the repayments to be made by the borrower. Cover can be granted cither for polccal sisks or for comprehensive risks. Political sikks covered under the scheme are following: (The oceurzence of war becween the country of the overseas party and India (The occurrence of war, hostilities, civil war, evolution, sebellion, insurrection or cies disturbances, whether asthe same kind as here in before enumerated or not in che countay of overseas patty. (ii) The operation of law or of an order, dectee or regulation having the force of lave which in circumstances outside the contr of the Lender and/or the Overseas ‘Panty, prevents, restricts or controls, the transfer of the stums due to the lender by. the Overseas Panty under the Financial Agreement, Where the Corporation agrees to provide comprehensive siske cover, the disk of proteacted default of the borrower ro pay the amounts due under the loan agreement and insolvency of the horower, whote applicable, will be covered in addition to the political risks ‘mentioned above. The preminin rates applicable to comprchensive tsk cover will naturally bie higher than that for politial sks ever. usCHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE “At least 20% of the total amount of premium payable for the cover should be paid in advance. The balance amount of premium may be paid on a quarterly basis in proportion to the amount of exedit disbursed, Services Policy: Where Indian compsnies conclude contracts with foreign principals for providing them with technical or professional secviees, payments due under the concracts are open to ticks similar ro those under supply contracts. In order to give a measure of protection so such exporters of services, the Corporation has evnlved four types of policies: © Specific Services Contac: (Comprehensive Risks) Policy: (i) Specific Services Contracr Political Risks) Poliey: Gil) Whole turnover Services (Comprehensive Risks) Policy; snd G@) Whole mrnover Services (Political Risks) Poliey Specific Poles, as its name indicates, is ised to cover a single specified contract. It is ised to provide cover for contracts which are lege in value and extend over a relatively long period. Whole turnover policies are appropriate For exporter who provide services to a set of principals on a respective basis and where the period of each contract is relatively short Such policies ae issued to eover all contracts that may be concluded by the exporter over a period of 24 months ahead. “The Comporation would expoet that the rerms of payment for the services ae in line with customary penetices in intemational trade in these lines. Contracts should normally provide for an adequate advance payment and the balance should be payable periodically based on the progress of work, The payments should be backed by satisfactory secusiy in the form of Lescrs of Credie or bank guarantees. Services polices are designed to cover contracts under which only services are to be rendered, Conuacts under which the value of services 0 be eendered forms only a small pare of a contmer involving supply of machinery or equipments will be covered uader an appropriate specifi poly for supply conteness Construction Works Policy: Construction Wosks Policy is designed to provide coxer to an Indian contractor who caceutes 4 eivil construction job abeoad. The distinguishing features of a construction contract are that 6CHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE (@) the contractor keeps sising bils periodically shroughour the coneract period For the value of work done berwees one billing peiod and anothers ©) w de eligible fe payment, she billy bave co be eestfed by « consultant or supervisor engaged by the employer forthe purpose and (© that, unlike blk of exchange raised by suppliers of goods, the Bll xsed by the conuactor does not represents conclusive evidence oF debe but are subject 19 parment in terms of the contet whieh may provide, among other things, for penalties or adjustments on various coun. ‘The scope for disputes is very lags. Besides, dhe contact value itself may only be an estimate of the work to be done since the contract may provide for cost escalation, vatiation contacts, additional con:sics ete leis, dherfore, important thatthe conteactor ensures that the contact is well dafied to provide casey of the obligations of the ewo partes and For resoltion of disputes that may arise in the course of exccution of the contract: Contractors wil be well advised 1o use dhe standard conditions of eomuaet (Imernational) prepared by the Federation Inemaiooal Des lngenieuss conscis (FIDIC) joinly with the Federation International de Batiment et des Travaux Publics PIBIP). ‘The Construction Works Pakiey of ECGC is designed to proteer the contract from. 85% of the losses that may be sustained by him duc to the following risks: (9) Insolvency of the employer (when he is a non Government entity) (©) Failucc of the employer to pay the amounts thar become payable wo the contractor in terms of the conteset, including any amount payable under an scbitration award (0 Restricon on wansfer of payments fiom dhe employer's country to India after the employer has made the payments in local currency (@)—Pailuce of the contractor to receive any sum dae aed payable under the contract by reason of war, civil war, rebellion, ete; (Failure of the contractor to receive any sun that is payable to him on termination. fot frastrtinn of the comtsact iF such fire is due to its having become Impossible to ascertain the amount ox ies due date because of was, civil wae, rebellion ete aCHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE ed (Imposition of restrictions on impor of goods or materials (not being the contrcsor's plant or equipments) or cxncellition oF authority to import such goods or cancellation of export license in India, for reasons beyond his control: and (@)_—_Imeaupiion or diversion of voyage outside India, sesulting in his incurring in respect of goods or materials exported from India, of additional handling, Uwansport or insurance charges which cannot be recovered feo the employer. (1) Guarantees to Banks: Timely and adequate etoditfacilios, t the pre-shipment as well «8 post shipment stage, ae essential for exporte:s to realise thee fll export potential. Exporters may not, however, be able to obrais such Faiites from their bankers For several reasons, eg, the exporter may be relatively new to expere business, she extent of fates needed by him may be out of proportion to the equity of the fizms o¢ the value of collazals offered by the exporter may be inset F.CGC has designed a scheme of guarantees for banks with a view to enhance the creditworthiness of the exporters, so that they would be able to socure beter and larget facitice from their bankers, The guarantees scek to achieve this objcesive by assuring the bunks, thst in the event of an exporter failing to dischazge his Tables to she bank, and thereby making the bank incur a loss, FE {C would make pod a major portion ofthe bank’s loss. ‘The bank: is requited to be the co-insuser to the extent of the remaining loss, Any amount recovered fom the exporter subsequent to payment of clslms shell be shared beeween the Corporation and the bank in the same satio, in which the loss was borne by them at the time of settlement of claim. Recovery expenses shall be frst charged on the ‘To moet the vecying nveds of exporters, che Corporation has evolved zhe following cope of Guntentes: Packing Credit Goarnice @ —_Expor: Prodetion Finance Guatantce (@) Pos shipment Export Credit Guarantee H) apr Finance Guarantee (0) Export perfomance Guarantee and ueCHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE eee (Export Finance (Overseas Lending) guarantee (il) Packing Credit Guaranzoe: Any Joa given (0 aa exporter for the manuf, processing, purchasing, or packing of goods meant for export aguinst a firm ordec or Letter of Credit qualifies for Packing Credit Guarantee. Pre-shipment advances given by banks to partes who enter ine contracts for export of services or for construcdon works abroad, to mice: preliminary expenses in connection with such contracts are also elpible for cover under che guarsetee “The requizement of lodgment of Lene of Credit, export order for granting packing credit advances js waived if the bank granes such advances in accordance with instructions of the ‘Reserve Banks of India in that respect. The guarsntes is iasued for a period of 12 momths against » proposal made forthe pucpote and covers all the advances daat may be made by dhe bunk during the period to a ven exporter within an approved limit. Tae bank is required 10 submit monthly declarations fof advances and repayments and to pay premium ar the rae of 10 pase per Rs.100 pee ‘mont on the highest amount oustanding on any day during the month, The aecount has 9 bbe conducted by the bank with the usual care and predenee, Approval of the Corporation ‘has to be obsained ifthe peti for repaymone of any advance is 10 be extended beyond 270 days from the date of advance, Ifthe bank appschends a 10s, it is required co ell back she ne outstanding advanees and to tee suitable setion to prevent of to minimise the Joss incl Any aetion suitable action to prevent of to minimise the loss inelnding any action that any be suggested by the Comoration. The bank will be ented to cam 66.2/3% of is loss from the Corporation if the entire amount due from the exporter is not recovered withic a period of four months ftom the de date of repayment. ‘The claim is payable if the Corporation is satisfied shat the bank had conducted the account with aormal banking prudence and has also complied with the terms and conditions of the Guarantee. Any amount that is zecovered, by the bank afte the settlement of the Claim has ro be shased berween the Corporation and. the bank in the same ratio in which the loss was originally borne by ther. ‘To banks which undertake to obsain cover for packing cred advances grant to all sts eustomers on allIndia basis, the corporation issues Whole Turnover Packing, Credit Guarantee (WTPCG). In consideration of the lage volume of business ollered for cover and ‘widespread sisks that will dhos become available t0 it, the Corporation grants higher percentage of Cover, lower premium sate and considerable sedvetion jn procedural formalities, The bene is required to aoxly limits eanctioned by it so alls enstomess but is 9CHAPTER -V INSURANCE AND FINANCING OF INDIA'S FOREIGN TRADE 1 required co seek the approval of the Corporation for Liisi they do exceed an ageeed value, called the Discretionary Limit. ‘The premium sate is 7 paise per Rs.100 per month, pajablo on the average out standings for the month. Administrative work for che bank is kept at the minimum. Banks which opt for WTPCG will be eligible For similar concessions in respect of Export Production Finance Guarantee ond Export Finanes Guatzntee also. ‘These concessions arc available also in respect of advances against contracts for supplies on dferted teems and for construction works, but the bank will have ro obtain separate _guarantees for such advances, Export Production Finance Guarantee: ‘The purpose of this guarantee is co enable banks to sanction advances of the pre« shipment stage tothe fill extent of cost of production when it exceeds the Co.b. value of the conteact/order, the differences representing incentives receivable. The extent of cover anc the premium sste are che same of Packing Credit Guarantee. Banks having WTPCG ae eligible foz concessionazy premium mate and higher percenmage of cover. Post Shipment Export Credit Guarantee: Postshipmmeut finance given to exporters by banks through purchase, negotiation o discount of export bills or advances against sch bills qualifies for this guaranree. Ic is necessary, however, thac che exporter concemed should hold suitable policy of ECGC to caver the overseas credit ish. ‘The premium swe for dis guaramee is 7 paise per Re100, per month. The percentage of loss covered under the individual Post shiprnene guarantee is 75, “This guarantee is ako issued on whole camoxer basis, offeing a higher percentage of cover at a reduced rate of pomium, The percentage of cover under the Whole tumover Post-shipment Guarantee is 85 for advances granted to exporters holding ECGC policy. Advances to non-policyholders are alsp covered with the percentage of cover being 60. The [premium rate is 3 pase per Rs 100/- per month if advanees against 1/C bills ate also covered under the Guarantee, otherwise itis 6 pase Individual Post-Shipoent Export Credit Guarantee can also be had, even where an ‘exporter does not hold an ECGC Policy For Finance pranted against L/C bills, provided that the exporter makes shipments solely against leters of ered, ‘The Premium sate for this cover is 10 paise pee Rs.10H pee month on the bi et amount outstanding on any day during the month and the percentage of cover is 75. Advances against bills under Letters of Credit 120CHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE, ‘opened by banks in countries placed under testsicted cover shall be subject 0 ptior approval of the Composition, Export Finance Guarantee “The guarantee covers postshiproent advances granted by banks to exporters against export incentive receivable ia the form of eash assistance, duty drawback, ete ‘The premium rave for this guarantee is 7 pase per Rs.100 per month and the cover is 75 pescent, banks having WTPSG are eligible for concessionary premium rate and higher percentage of cover, Export Performance Guarantee: Expocters are often called upon to execuce bonds duly guaranteed by an Indian Bank a various stages of export business, An exportce who desites to quote fora foreign tender ‘may have 10 furnish a bank guarantee for the bid bond, Ife wins the contzuct, he may have to fornish bank guarantees to foreign buyers to ensute due performance, oF against advance payment, oF in lew oF retention money, of to a Foreign bank, in ease he has to fase overseas Finance for his contract. Pure, for obsaining import licenses For raw materials of capital goods, exporters may have wo execute an undertaking w export goods of a specified value ‘within stipulated sime, duly supported by bank guarantees, Hank guarantees are ako furnished by exporters to the Customs, Central excise or Sales ‘Tax authomties for the purpose of clearing goods without payment of duty of for exempriva from tax for goods procured for export. Exporters also furnish guarantees in support of the export obligations 10 Export Promation Councils, Commodity Boards, and The State Trading Corporation of India, The Mineesls and Metals [eading Corporation of India or recognized Export Houses An export proposition may be frustrated iF the exporters bank ie unwilling 1 issue the Guarantee, ‘The Export Pesformance Guacantce is aimed at meeting such situations. The Guarantee which isin the oatuce of a counter guarantee ro the bank is issued 0 protect the Dank against losses that ic may sutfer on account of guarantees given by it on behalf of exporters, This protection is intended to encourage banks 10 give guarantees on a liberal basis for export purposes ‘Normally cover is extended up to 75 percent of loss, but in the ease of guarantees in connection with bid bonds, petformance bonds, advance payment and local finance guarantees end guarantees in lew of retention mones, the cover may be increased up co 90 ‘percent subject to proportionate inerease in premium,CHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE While the premium rate for guaranice issued 10 cover bond relating to exposts on shoretemn credit is 0.9% pa. for 75% cover and 1.08% pa. for 911% cover, itis lower for bond, clacng (0 exports on deferred exedic and projects ‘The rate of premium is 0.8% pa. for Yo cover and 0.95% pa. for 90 % cover Jn the case of Bid Bonds relating to exports on mediim/long term ered, overseas projects, and projects in Tadia financed by international financial institutions as well as supplies to such projects, ECGC is agreeable wo issue Fepore Performance Guarantee on paymear of 25% of the prescribed premium, The balance of 75¥% becomes payable to the Coxposition by the bankers ifthe exporter succeeds in the bid and gees the contract. Export Finance (Overseas Lending) Guarantee: I 4 bank financing am overseas projcet provides a foreign currency loan to the contractor, it can protect itself from the tisk of non-payment by dhe contractor by obtsiing Export Finance (Overseas Lending) guarantee, Premivim rate will be 0.9% per annum for 15¥% cover and 1.08% per annum For 90% cover, Premium is payable in Tndian Rupecs. ‘Claims under the Guarantee will also be paid in Indian Rupecs. (IV) Special Schemes: ‘Transfer Guarantee: When a bank ia Tadia adds is confirmation to a foceiga eter of (Credit, it binds itself fo honour the drafts dravin by the beneficiary of the Letter of Credit “without any recourse to him provided such drafts are drawn strcily in aecocdance with the ters of the Lever of Credit. The coaficming bank wil suffer a loss ifthe foreign bank fas to seimbusse it with the amount paid to the exporter. This may happen due to de insolvency or default of che opening benk or due to cesain political rishs suc as war, eransfer delays oF rmorwtorium which may delay or prevent the transfer of finds co the bank in India, The transfer guarantee sesks to safeguard banks in India against losses arising out of such risks “Transfer Guarantee is issued, at che option of the bank either to cover political ishs alone, oF cover both politcal and commercial sisks, Loss due to politcal tisk is covered up to 90" tnd loss due to commercial siske up t0 75 percent. Peemium will be charged at rates normally applicable co the Comporation's insurance policy covering export of goods, Overseas investment insurance: ECGC has evolved 2 scheme to provide proreetion For Indian Investments abroad, Any investment made by way of equity capital or untied loan for ra.CHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE See the purpose of seting up or expansion of overseas projects will be eligible for cover under fnvestment insurance, ‘The investments may be either in exsh or in dhe form of export of lodiae capital goods and services, The cover would be available for the Ociginal investment together with ancul dividends or interest scezivable, ‘The sisks of wa, expropriation and sestsiecion on remittances are covered under the scheme, As the investor would be having a band in dhe management of the Joint venture, no ‘cover for commercial risks would be provided under the scheme, For investment in any ‘country co gualfy for invesementinvwrance, there should prefesably be a bilaetal agreement protecting investment of one country in the other, ECGC may consider providing cover in the absence of any such agreement provided i is satisfied char che general laws of the country alford adequate peotcetion to the Indian The period of insurance cover will nor normally exceed! 15 year in case of projects involving long construction petiod, cover may be extended for a period of 15 years Feom the ‘date of completion of the project subject wo a masimum of 20 years from the date of ‘commencement of invescient, Amount insured shall be reduced progressively in the ast five vyoaes ofthe insurance petiod Exchange Fluctuation Risk Cover: The Exchange Fluctuation Risk Cover Scheme has been intended tn provide a measure of protection to exporters of capital goods, il engineering contractors and consulcants who have often to reecive payments over a period of yews for their exporss construction works or services. Where such payments ate to be received in foreign curveney, they are open to exchange factuation risk as the forward exchange market does nor provide cover for such deferred payments Exchange Fluctuation Risk cover is available for payment scheduled over a period of cof 12 months of mote, up to a maximum of 15 years, Cover can be obtained from the da Didding ight up to ehe final inseallmen. [At the stage of bidding, an exporter/contrietor ean obtain Exebange Fluctuation Risk (Bid) cover. The basis for cover wil bea eeferenee rate agreed upon, The reference cate can be the rate prevailing on the date of bid oF rate approximating it, The eover will be provided initially fora period of twelve months and can be extended if necessary. If the bid fs suocessfl the exporter/contrator is required to obtain Exchange Fluctuation (Contract) iPCHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE ‘cover for all payments due under the contsnes. The reference rate for the contract cover will be liber the reference ote used for the Bid covet or the sate prealing on the date of contact, the option of te espostes/contictn, TF the Bid uasucecsfl 75 percent of the premium paid by the exporter/contractor is refunded to him. ‘The Exchange Fluewation Rick (Contact) cover can be issued only ifthe payments under the contract are schedied to be received beyond!2 months from the date of contract Dburin such ease, the cover wll apply for any installment falling due within £2 mondhs a well Cover wal be available forall amounts reecvable under the contract, whether itis payment for goods or serviees or interest o any other payment. Contrets coming under Buyer's ‘redit and Line of Credit ar also eligible for cover under the schemes. The exporce hs also an option to terminate the contract at the expiry of the thied year, by giving three months advance notice. Cover under the schemes is available for payments specified in US Dollar, Pound Sterling, Deustehe Mark, Japanese Yen, French Franc, Swiss Frane, UAE Disham and Australian Doll. However, caver can be extended for payments specified in other convertible currencies at the discretion of the ECGC. Exchange Fluctuation Risk cover will pormully be provided along with suitable credit ingwanee cover, Thess is, however, provision to grant the cover independendy also in whl, cease premium will be loaded by 20%. ‘The contract cover peovides a franchise of 2 percent loss or gain within a range of 2 pement of the reference rite will go to the exporcer’s account, If loss exceeds 2 pereent, ECGC will make good the portion of loss in excess of 2 percent bur noc exceeding 35 percent of the reference rate In ther words losses up to 2 percent and beyond 35 penceat of the ceferenee sate will be 10 the exporte’s account. TE there is gan in exeess oF 2 percent cof the reference rate the portion which is beyond 2 percent and up 10 35 peteent will be turned over to the ECGC, “The rate of premium is 40 paise per Rs.1U0/- per year or 10 paise pee Rs.100/- per quartet forthe bid cover and the total premium is payable at che tne of issue of the Policy Premium for contract eover is also payable at the rate of 40 palse per Rs-1D0/- per anmmm. “Ten percent of she total premium payable and premium foe dhe frst rwo years should be paid a che time of issue of che policy. Thereafter, the anual press will have to be paid in such ‘manner chat premium for the next ewo yeus is alvsas kepe paid 1 the eorperation, 124CHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE, cc Operational Performance of ECGC The Corporation continued to pose a good performance in the financial year 2001-02 ‘and exined a net profit of Re 46.04 crores. ‘There was a marzinal decline in ECGC's coverage ‘of small term exports, during 2001-02, In the Financial year 2001-02, Premium Income catned by the company grew to Rs338.52 crores and the total claims paid were Re.487.12 crores. Since inception to March 2002, the Corporation paid aggregate claims worth Rs, 2753.58 crores apainst aggregate premium of Rs, 2781.23 croresCHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE Globally, the credit insurance business has been going through rough weather, but irs business ice the short-term interestingly it has sill not affected the ECGE in some of credit insurance. In the medivan and long cua however it would get alfected as 2 eospacation may not be able to underwrite big projects of huge value unless einsusance cover is made available from global reinsurers who do not want to cover any risk for project exports in African, some Asian and Latin American counties. For large projeers the reinsurance ‘coverage is not available, Jo guarantces to the Taian banks the clim-premium ratio has beon sdverse-about 147 percent, ‘The banks do not provide pre-ship and finance guarantee these days doe to exporters failure wo export. If the banks are unable to recover the amount from the exporters, the IKCGC has to pay to the bank, This has prompted the corporation to increase its premium rates, ‘The cosporation bas kepe ies focus om small and medium-size exports intact, For exporters whose main business is in developing mackers, the eosposation has created a new premium structure and also reduced its prem, ‘The corporation has 30 offiees in the county with over 14,000 expontess as its client boase, yor it has to be vigilane has a number of new insurance companics and even banks are thinking of geting ineo the insueance busines EXPORT - IMPORT (EXIM) BANK OF INDIA ‘The EXIM Bank of India which is wholly owned by the Goverament of India was set up in September 1981 by an Act of Parliament to finance, feiltate, and promote the foreign trade in India. As the principal institution it commenecd its operations in March 1982 to coordinate the export and import financing instcucions of the county. [ts heal office is located in Mambai and is having network of shineen offices in India and overseas (Singapore, Budapest, Milan, Washington DC) Vision: The bank’s vision has evolved from Binaneing, Facilitating and promote i India as foreign wade x0 creating export capability by arranging, competitive financing a¢ various stages of the expos eyele, The bunk has a vision to develop commercially viable celadionships with a carger set of extesnaly oriented companies by offering them a comprehensive range of products and services, aimed at entancing their internationalization effort, wrCHAPTER - V INSURANCE AND FINANCING OF INDIA'S FORBIGN TRADE Services Provided By the EXIM Banl ‘The XIN Bink provides a range of analytical information and expo slated services. It’s fee based services help identify new business proponitions, source trade and investment related information, create and enbance preseace through joint nework of institutional linkages across che globe, and assists externally orieneed companies in their quest {for excellence and globalisation. Services include seach for overseas pactncs,ideatication ‘of eechnology suppliers, negoriting alliances, and development of joine ventures in Indi and sbrosd, The Bank also supports Indian project exportees and consultants to participate in projects Funded by rmubilateral funding agencies. IM A per the Bank's Annusl Report 2002-2003 the major programmes of the F: Bank include: (@) Export credits: this includes Lines of credit, buyer’s credit, pre- shipment ered, supplie's credit finance for consultancy and technology services, Cash flow Finance for project export contracts, the refinance ro commercial banks, guarantees. (b) Services: These include the export marketing secs, Advisory services (for projects Junded by 4 moldlawral agencies), knowledge building (dissemination of findings of research suidies), Information services (country market and sectors studies), and Joint ventures failation. (©) Promotional programs: These include promotion of Inéian consultancy services through Afiica project developmen fality, Aftican management Scrvices Company, Mekong project development facility, Southeast Europe enterprise development, China project development facility, South Asia enterprise development facili private enterpsse partnership (CIS. counties). @ Finance for export oriented units: this includes Project Anance, equipment finance, working capital finance (short and medium term), overseas investment finanee (equity finance/ equity participation in ventures overseas), refinance «0 commercial banks, export marketing finance, finanes for export product development, Finance for research and development, Import finance, finanee for sofiware tnsining Invtuute/ software technology Parks, and Finance for minor ports development, PyCHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE —— ‘EXIM Bank-Business Operations ‘The EXIM Bank's business operations ean be discussed under the following heads: (@ Projects, products and services exports: Dusiag 2002-2005 110 espost contrcts amourring 1 RSGB31bn covering 45 connbszs, wexe secured by 59 Tadian exporters with EXIM benks support. The contacts secured by the bank during tbe year included vumkey coneacts, construcion conte, supply contracts, and consultancy comets, The major euskey contmts secured during the eae included power projet in Jean, Oman And Tannin; rnsmision line projects in Alpe, Banglades, Tez, hop, Tunisia and UAB: gas developmen project in ‘Taran, slphr covery project in Ket The construction contracts where caried and construction of the chilled water plant in UA out in Turkey, Quiar, Sadi Arabia, Kuwaie, Indonesis, Maussus, UAE and Afghanistan, ‘The supply contracts were secured in Egypt, Indonesia, USA, Europe and Srilank, Iraq ete “The technical consultancy and services conteacts were done in Nigeria, Mongolia ere. Dusing 2,002.2008, the EXIM Denk sanctioned Rs.3.S6ba by way of supplice’s credit, buyer's ‘relit,and finance for projees exports, This exhibited a cise of 66 pereent in sanctions over the previous year, Guarantees were sanctioned! amounting t0 Rs.9.33n(21022008) as apainst ReS.4Sbn in the previous year, These guantoes were ced wo overseas secbnical consultaney contacts, power generation and uaasmission conte, construction contacts in erode oil, transmission, infastructare and few supply comets and export of vacation (guarantecs issued under the Foreign Taade Guarantee Program, Lines of ered che EXIM bank extends lines of credi: (LOC'S) to overseas financial insutudious, dhe regional development banks, sovereign governments and other entities overseas, 10 finance and promote India's exports to its trading partners, especially the Geveloping counties. LOC is a financing mechanism that provides 4 safe mode of not- recourse financing option «0 Indian exporters, especially 0 small and medium sized enterprises (MES) and serves at an effective matker entry tool. Dusing, 2,002-2,003, the bank extended seven LOCs aggeegatng 257 milion US. dollars to uppor exports of goods and secvices fiom India, These were extended 10 Banca Comesciala Romana(Romanian Commercial Bank $.A),Voesinorgbank(Bank for Foreign Tad and South Mican ‘Tarde and Development Bank(PTA Bank)-covering 16 councics in Baste and Southem Afvica Seychelles Marketing Board Seychellesseven Inia Commercial Banks viaBank MellarBank Meli Iran.Bank Saderst Iran,Bonk Sepab,Benk ‘TejarayBank of Indusry8MineEspore Development Bank of IstasHiatton National Beak 9CHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE —— ___ ‘Lad. Sti Lanka and Tre & Investment Desslopment Corporation, Philipincs(TIDCORP cPhill:xi). ‘The bank with the permission of the RBI can now cover under LOC all expore goods permitted unclct the EX lasgest ever LOC of 200 milion US. dollars wus with seven Innian commeneal banks IM policy of che government of India, During 2,002-2,003 the (I) Building export competitiveness: ‘the FXIM Bank offers a wide range of financing programs which are aimed at enhancing export, compeditiveness of Indian companies. During 2,002.03, banks senctioned amounting to Rs.3439n Under she program for enhancing export competitiveness. [Loans to export oriented units were sanctioned by the bonk 43 term loans of Rs. 1652bn to eighty Export orented units incinding, Rs-11.31bn by way of refinancing to ‘commercial banks in respect of 37 unit. Under Production Equipment Finance Programme , 28 esporting, componics were senetioned Rs.3.9bn for financing aequistion of produetion equipment.44 companies were sanctioned Jong term working capital loans aggrgaing Rs 7 46ba. ‘The EOUs financed by the Bank belong to vacious setoes such as phasmaccuticals, capital goods, chemicals, enim clectronies, engineering goods, gems & jewellery ee The EXIM Bank as 4 Primary Lending Insttotion under the Technology Upgridetion Fund Scheme (TUFS) for che Textiles and Jure Industries sanetioned loans worth Rs1.27ba wo 14 companies, IM Bank has extended nancial of Re, 238ma help to support R&D scivities of thee companies in the pharmaceurcals sector. With a view to help dhe increase the supply of eained manpower for the computer software induseey the Bank has extended a nance of Rs.9.0ma ro one of the Sofware “Training: Institute instirues in the yoar 2002 2003.The EXIM Ban also sonetioned Rs.I50.Smn to fixe companies for sttege export market development plans dtcet towards developed nasions inthe computer sofbwace and geod food processing sectors. The bank has also come forward to lend 2 helping hand w out companies for financing subsiciaties/join venues abroad, It has sanctioned a loun of RsLi3bn in the year 2002-2003.TThese ventures were in the fiekd of software, tea pharmaccutieals, and consumer goods sectors in USA, Europe und China, Under the Export Facilitation Progeamme the EXIM Bank has sanctioned Rs.1.93ba for port scrvices. ‘To finance the imports the Bank under the Bulk Import Finance SST 130CHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE Programme, has sanesioned amount woh Rs2s0mq ia the year 2012-2005.Under the Impor: Finange Programme , siz companies were sanctioned term loans of Rs.3.37Bn in the yar 2002-2003, (0) New Initiatives: “The EXIM Bank is tying to tap the parental of the North-Easteen Repion of India. It his established an office in Guwabatin January 2003 which ideas viable projects andl ‘export ransactions, expecially in the feds of agricultare sector. The Bank's arangement With (he Jovernadons) Finance Corporation World Bank Group) 10 utlize Indian ‘consulemnes now inchudes South Asia Facility. Through this assistance can be rendered 10 the ‘North-Eastern region of che county. ‘The EXIM Bank hes set up an Agit Business Group to suitaia the exports in the sector of agriculture, The Bans has concluded agreements with Ministry OF Food Processing, NABARD (National Bank for Agriculture and Rural Development) and APEDA (Agricultural and Peoeessedl Food Praduets Fxpost Development Authority) to aupment the agricexports of the country. ‘The Bank has also joined the Small Farmers? Age-Business Consortium (SFAC) to help the small farmers. ‘The bank bas omganized seminars and investors conferences at Guwahati , Mumbai, Bangulore and Kolukacat vo bring together potential investors, wade failators, policy makers and promotional bodies on one plaform first co boost investment into the Agri Export Zones. ‘The bank has lounched Export marketing secvice for Indian eompenies. It widens very support bars in terms of new buyers in various enuntries, The companies ther have availed the service of the hank belong t© sectors like textiles, corton yarns, asurvedic products etc. the bank provides assistance in searching overseas markers, fciiating placement of final orders ete, Global Trade Finance Private Limited (GTI), a joint venture, promoted by EXIM Bank, with Westdeutsche Landesbank Giruzeneale(West LB), Gentnany and laternational Finance Cosporaion (TEC), Washingeon DC has completed first full year ‘of operations. Its objective is to promoce matket driven expore-fingncing solutions for SMEs. GTF foc the first time ia India offers struenied foreign tre financing products such as forftting and feetoring. The bank's other joint venture, Global Procurement Consultants Limieed (GPCI) carried out consultancy assignments in Tanzania, PolondBosnia ete.GPCL Provides procurement related advisory and auditing, scrvices primarily for projects funded by the mukilateral agencies in vations developing counties,CHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE, “The EXIM Bank has ser up a Loan Recovery Group proactively prevent slippage (of standard assets into non-pesforming assets. “The bank is having cegular interaction with the industry theough an interactive wels site, ‘The bank serves as the Secrecariae ofthe Task Foree constituted by the prime minister's office to develop wide-cinging recommendations that would lead to a quantum increase in project espons (IV) Financial Performance: As on 3ist March, 2003, the EXTM banks resources, Including paid-up capital Rs.6.5bn and reserves of Rs.13.17bn aggreyaced Rs.123.19bn. This 1g paid-up capi eres resource bese inchudes bonds, eerfcates of deposit, commetcal papers and foreign eu deposits/ borrowings / Jong term swaps, ‘The bank’s debe instruments continned co enjoy the highest cating vies “AAA? from the rating agencies, CRISIE. 2nd ICRA. The bank has sised External Commercial Borrowings (ECBs) of 50 million US. dallas and 145 million US. dallas by way of botowings from the commerce banks. ‘The profit before tax and the aftec wx of the BXIM bank were at Rs.2.65bn and Rs, 2.07bn daring the year 2,002-2,003 estimated to the previous year’s PBT and PAT of Rs.22tbn and Rs.1.71bn respectively (V) Information and Advisory Services: The bank provides a wide range of information, advisory and suppor services which complement is financing programs, These seevices are provided on a foc basis ro the Tadian and overseas entities. “These services inciude market-rcated information, sector and feasibility studies, technology supplier ientfieation, partners search, investment facilitation and development of joint ventures booth in Tia and abroad Mulilatceal Funded Projects Overseas (MPPO): the bank assists the Indian companies in improving thcie prospects for sceuring business in projcers funded by the World Bank, Asian Development Bank, Afvican Development Bank and Eueopean Bask for Reconstruction and Development. ‘Ao Eximias Club has been set up by the tive 10 provide information and advisiony services c the metabars, ‘The elub focuses to improve the prospects of is members in scouring projeess funded by mulelarerl agencies. With a view to enlasping and necworking with international organizations and othec service providers, the bank has entesed into cooperttion agroements and MOUs with Board of Tnvestment Maurits: Board of Tovestment Sri Lanka; and Industrial Development Corporation of Sowh Area limited, South AtticsCHAPTER -V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE, Tre Dank as invsacd olding meetings anally with Asan HCAs (export Credit Agencies) 1 exchange narmaton and shace Mes n a tear aa ance, In 1986 at Banglore the fist mecting was held (V1) Promotional Programmes: the EXIM beak as an arrangement for sponsoring and part financing Indian consulants for providing consultancy services co private sector SMBs in developing counties under technical assistance program of Intemational Finance Cosposation (URC) Washington D.C. and other insemational agencies. Dosing 2.000 10°2,003 the bank has sponsored ew Indian consultants for projects under Mekong Project Development Fully and Southeast Europe Enterpise development. ‘Ihe bank las part financed Indian consultancs to execute short term consultancy assignments for IE Sponsored peojeers in China; southesn countries of Asia covering Bangladesh, Nepal, Bhutan and Northeastern India and Armenia Azerbaijan (Belarus Georgi Russia ete. The Eximius Contes for Learning, Bangalore t during the year 2,002-2,003 has conducted to 25 programs ‘which included specific business opportunites sexnars. The center has conducted eight workshops on Coxporate Treasury and Risk Managemens, Commercial and Legal aspects of Intemational Contacting: Expor Packaging-machine cools, wextles, garments and agriculcure crc, the center has conducted programs on Business Opportunities in European Bank for Reconstruction and Development Funded projects in Mumbai and New Dali (VI) Information Technology: ‘The EXIM bank has uied to enance the use of, Knowledge management tools, communication across its vations constituents for beteer sharing of information, user empowesment and system intelligence capabilities. System up gradation wes cactid ont in the areas of planning ane budgeting; country analysis; industry analysis; isk measurement and analysis etc. To improve the Bank's Agri-Husiness initative, an ageo-portal www enimbankagro.com has been developed. (VIL)Research and Analysis: The EXIM Bank has instituted an annual avasd for research in ‘international economics, ace and related financing’. This award seeks 10 promote research in internacional economies, wade and related financing by Indian nationals ar universities ond attended institutions in India and abroad. The bank has published for Occasional Papers reared to IT enabled services, Horticulture products) factor movernents, wage inegualiy ete. The Working Papers published by che bank daring this year rclaced co the pharmaceasisl products, health insurance, ete, 133CHAPTER - V INSURANCE AND FINANCING OF INDIA’S FOREIGN TRADE, (IX) Human Resources Management: 9: on 31" march, 2,003 the EXIM bank hes total stat of 167 in its service.“ It includes a professional stat (engincers, economists, bankers, chartered accountants ote). During 2,002-2,003 126 officers auended the exaiing programs and seminars on a variety of subjects which were related ro the bank's operntions. The program's inckided induswial finance, forex and financial desvarives and tisk 1