In a win win pact, the Indian government is extending a $ 2 billion line of credit to Bangladesh which is expected to open 50,000 jobs in India and boost Modi's 'Make in India' drive. The line of credit will provide loans at subsidised rates from agencies such as the Exim Bank. These are normally conditional on the recipient using the loan amount to buy equipment and services from Indian entities such as BHEL, RITES and small and medium enterprises.
“We have already provided $862 million line of credit to Bangladesh and this $2 billion is going to provide a big boost to project exports from India and help Indian companies,” Yaduvendra Mathur, chairman and managing director of Export Import Bank of India said.
Under the line of credit (LOC) a minimum of 75% of goods and services needs to be of Indian origin and must be procured from India. Exim Bank of India's LOCs are boosting the country's international trade and project exports and it plays an active role in supporting Indian project exporters to execute developmental projects in over 60 countries which in turn provide immense opportunities to Indian firms to demonstrate their project execution capabilities.
The government has so far, provided 225 LOCs to 61 countries under the Development and Economic Assistance Scheme. These LOCs have been extended to countries in Africa, Asia, Latin America, Oceania and the CIS, totalling $14.87 billion. Over 170 Indian companies have executed or are executing projects worth $7 billion.