Exim banks of India and Hungary sign credit pact

Mumbai: Exim Bank of India has signed a $10 million reciprocal line of credit with the Exim Bank of Hungary to support bilateral trade.

Exim Bank of India executive director S R Rao signed the agreement with Exim Bank of Hungary chief executive Zoltan Bodnar in New Delhi during the visit of Hungary's minister of foreign affairs Kinga Goncz, Exim Bank said in a release. The reciprocal line of credit arrangement is aimed at catalysing bilateral trade that requires medium term credit support, the release said. Exim Bank of India is also planning to raise $750 million in the next six months as businesses, including Tata group expand overseas and increase trade.

The state-owned financier will obtain loans from global banks and sell euro- and yen-denominated bonds in maturities of one to seven years, Subramanian had said in an interview reported early last month. Exim Bank needs to keep pace with a doubling in India's merchandise trade in three years to $240 billion and rising cross-border investments. Prime minister Manmohan Singh had said India is the third-largest investor in the UK and urged companies to set up in Asia's fourth-biggest economy.

Exim Bank is assisting companies in the automobiles, drugs and textiles businesses to make acquisitions abroad, Subramanian said. It helped finance Tata Coffee Ltd., Asia's largest coffee plantation company, to buy US-based coffee retailer Eight O'Clock Coffee in June. ``Exim Bank financed 21 acquisitions last year and this year we are looking to do more,'' he said.