The Cabinet has allowed the listing of Export Credit Guarantee Corporation, while clearing an investment of up to Rs 6,000 crore in the company that offers insurance cover to exporters and the National Export Insurance Account Trust.
While Rs 500-crore equity will be immediately provided to ECGC, a matching amount is to be given next year, along with its listing. The remaining funds, commerce and industry minister Piyush Goyal said, will be provided depending on requirement. He said part of equity requirement can also be met through the issue of fresh shares at the time of the IPO, which is likely next year.
For nearly a year, the government has been weighing options to strengthen ECGC, while joining the league of listed public sector companies. The Cabinet’s decision to provide the equity support can be spread over five years, officials added. The government is hoping that the corpus will come handy in doubling its maximum liabilities to over Rs 2 lakh crore.
Similarly, the Rs 1,650 crore allocated to the National Export Insurance Account Trust is meant to boost project exports. These exports are typically targeted in West Asian and African countries and also help Indian content. Goyal said that the latest moves are part of an overall exercise to boost exports, with the government setting an ambitious target of $400 billion this year.