• The Cabinet Committee on Economic Affairs on Wednesday approved capital infusion of Rs 2,000 crore in the Export Credit Guarantee Corporation (ECGC) to enhance insurance coverage to micro, small medium enterprises exports.

• According to a statement from government, ECGC provides insurance cover on exports to around 200 countries and more than 85 per cent of its customers are MSMEs.

• The break­up of the infusion would be Rs 50 crore in 2017­18, Rs 1,450 crore in 2018­19, and Rs. 500 crore in 2019­-20.

• The infusion would enhance insurance coverage to MSME exports and strengthen India’s exports to emerging and challenging markets like Africa, CIS and Latin American countries.

• The increased capital infusion would also help ECGC to diversify its product portfolio and provide cost­ effective credit insurance to exporters.

• With a stronger underwriting capacity, ECGC will be in a better position to support Indian exporters to tap new and unexplored markets.

• ECGC is a premier export credit agency of the Government of India to provide Export Credit Insurance Services to facilitate exports from the country. 

• The ECGC offers credit insurance schemes to exporters to protect them against losses due to non-payment of export dues by overseas buyers due to political and / or commercial risks.

• ECGC provides :

(i) a range of insurance covers to Indian exporters against the risk of non – realization of export proceeds due to commercial or political risks.

(ii) different types of credit insurance covers to banks and other financial institutions to enable them to extend credit facilities to exporters and

(iii) Export Factoring facility for MSME sector which is a package of financial products consisting of working capital financing, credit risk protection, maintenance of sales ledger and collection of export receivables from the buyer located in overseas country.

• ECGC comes under the Ministry of commerce and industry.

• The Cabinet Committee on Economic Affairs has also approved contribution of grant-in-aid of Rs 1,040 crore to National Export Insurance Account Trust (NEIA) to promote project exports from India that are of strategic and national importance.

• The corpus is to be utilised during three years from 2017-18 to 2019-20.

• An amount of Rs 440 crore has already been received for the year 2017-18. Rs 300 crore each will be given to NEIA for the years 2018-19 and 2019-20.

The Hindu, Indian Express, PIB.