Exim Bank in talks with Hyderabad firms for project finance -

Exim Bank in talks with Hyderabad firms for project finance

Hyderabad: Export-Import Bank of India (India Exim Bank), which facilitates financing to companies involved in exports and imports, is in an advanced stage of discussion with four companies in Hyderabad from different sectors and is going to initiate talks with 10 more companies in the coming months.

N Ramesh, deputy managing director, India Exim Bank, told Telangana Today, “We are talking to an engineering company in Hyderabad that works with global aerospace and energy companies in making turbines and other critical components.”

“We are also in discussion with a company that has a unique drug delivery system in the pharmaceuticals sector, targeting the US market. We are also talking to a plastic recycling company with unique processes with a potential to serve the FMCG sector in a big way. The fourth is a drone company that is aiming to serve the defence sector in India and worldwide,” he added.

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The idea is to identify companies that have the potential to be future champions in the domestic sector while also catering to global demand. The bank is screening 10 promising companies in Telangana under ‘Ubharte Sitaare Fund’ to support them.

“We are supporting companies with different turnover levels. For instance, the engineering company in Hyderabad is a Rs 150-crore company while the company making drug delivery systems is a Rs 10-crore company. We will be supporting these four companies this fiscal with about Rs 100-crore finance and the remaining 10 firms in the next fiscal. We find Hyderabad companies very innovative and are capable of achieving big in critical engineering and manufacturing areas,” he added.

The fund is primarily created to support and benefit micro, small and medium enterprises (MSMEs). It has been set up by Exim Bank and SIDBI to identify Indian enterprises with potential advantages by way of technology, products or processes along with export potential, but which are currently unable to tap their full potential to grow.

He informed, “Exim Bank and SIDBI have developed a pipeline of over 100 potential companies across the country as part of this initiative.” The fund offers a mix of structured support, both financial and advisory services through investments in equity or equity like instruments, debt (funded and non-funded) and technical assistance (advisory services, grants and soft loans) to the Indian companies.

When asked how much of project financing is attracted by Hyderabad industry across schemes from India Exim Bank, he said, “There is a huge demand from the companies here for financing. It will not be less than Rs 3,000-Rs 5,000 crore across sectors. Pharma, EPC and engineering products are the dominant sectors. Telangana is among the top 5-7 States for India Exim Bank consistently.”

Project exports

The bank is aiming to achieve financing of $7 billion of project exports over the next five years, through the funds received from the Government of India in the National Export Insurance Account (NEIA). Earlier in September 2021, Indian government approved a corpus of Rs 1,650 crore in the NEIA to boost project exports.

The corpus infusion will enhance the project export possibility having cover by NEIA by about Rs 33,000 crore over next five years (equivalent to $4.5 billion). The infusion will help tap potential of project exports in focus markets. The Bank has currently supported 32 projects valued at $3.13 billion in 15 countries under the Buyer’s Credit under NEIA programme.

India Exim Bank is expecting its credit to grow to Rs 1.21 lakh crore this fiscal from Rs 1.1 lakh crore during the last fiscal. Its portfolio is dominated by EPC, textiles, pharmaceuticals, petroleum products and infrastructure with core geographic focus being Africa, Southeast Asia and Latin America.

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