INDIA DECIDES NOT TO EXTEND LINES OF CREDIT TO DEVELOPING COUNTRIES

FURTHER FUND RELEASE TO BE THROUGH IDIF

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India has decided that new lines of credit to friendly developing countries would not ordinarily be extended and further releases of funds could be met through the corpus of India Development Initiative Fund (IDIF). However, the lines of credit already entered into/partially utilized may be allowed to continue till their completion.

Presently lines of credit worth US$ 239 million in favour of Kyrghyzstan, Mauritius, Uzbekistan, Myanmar, Sri Lanka, Cambodia, Laos and Suriname are in progress while Vietnam has a sanctioned line of credit worth Rs.1070 million in operation.

The IDIF would also meet the demands for lines of credit through funding of the interest differential in respect of credit to be managed and operated by Exim Bank of India. This is being proposed to ensure proper and effective utilization of the lines of credit through an organization in a professional manner.

The decision follows the implementation of IDIF announced by the FM in his Budget Speech this year.