Export Credit of $268.35mn to Tanzania for Lake Victoria Pipeline to Tabora, Igunga and Nzega

[RBI Circular No. 33 dated 10^th December 2015]

Sub: Exim Bank's GoI supported Line of Credit of USD 268.35 million to the Government of United Republic of Tanzania

Export-Import Bank of India (Exim Bank) has entered into an Agreement dated June 19, 2015 with the Government of United Republic of Tanzania, for making available to the latter, a Government of India supported Line of Credit (LOC) of USD 268.35 million (USD Two hundred sixty eight million and three hundred and fifty thousand) for financing eligible goods, machinery, equipment and services including consultancy services from India for the extension of Lake Victoria pipeline to Tabora, Igunga and Nzega, Tanzania. The goods, machinery, equipment and services including consultancy services from India for exports under this agreement are those which are eligible for export under the Foreign Trade Policy of the Government of India and whose purchase may be agreed to be financed by the Exim Bank under this agreement. Out of the total credit by Exim Bank under this agreement, the goods and services including consultancy services of the value of at least 75% of the contract price shall be supplied by the seller from India and the remaining 25% goods and services (other than consultancy services) may be procured by the seller for the purpose of the eligible contract from outside India.

2. The credit agreement under the LOC is effective from October 07, 2015 and the date of execution of agreement is June 19, 2015. The last date for opening of letters of credit and disbursement will be 48 months from the scheduled completion date(s) of contract(s) in case of project exports and 72 months from the execution date of the credit agreement in case of other supply contracts.

3. Shipments under the LOC will have to be declared on EDF/ SDF Forms as per instructions issued by the Reserve Bank from time to time.

4. 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. Authorised 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.

5. AD Category-I banks may bring the contents of this circular to the notice of their exporter constituents and advise them to obtain full details of the Line of Credit from the Exim Bank’s office at Centre One, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai - 400 005 or log on to www.eximbankindia.in.

6. The Directions contained in this circular have been issued under section 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.