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RBI issues notification to operationalise USD 500-mn loan provided to Sri Lanka for petro items
Export-Import Bank of India (Exim Bank) entered into a pact on February 2, 2022, with Sri Lanka to provide the USD 500-million line of credit for financing purchase of petroleum products.
The RBI on Thursday issued a notification to operationalise the USD 500-million line of credit provided by India to Sri Lanka, which is facing the worst economic crisis in decades due to the pandemic, to buy petroleum products. Export-Import Bank of India (Exim Bank) entered into a pact on February 2, 2022, with Sri Lanka to provide the USD 500-million line of credit for financing purchase of petroleum products.
Out of the total credit by Exim Bank, goods, works and services of value of at least 75 per cent should be supplied by the seller from India, the RBI said in a notification.
The remaining 25 per cent of goods and services may be procured by seller from outside India.
Out of the total credit by Exim Bank, goods, works and services of value of at least 75 per cent should be supplied by the seller from India, the RBI said in a notification.
The remaining 25 per cent of goods and services may be procured by seller from outside India.
Under the LoC, the terminal utilisation period is six months from the date of signing of LoC agreement or other extended date agreed at the request of borrower.
However, the extended date should not be beyond 12 months from the date of the agreement, the RBI said.
Sri Lanka is currently reeling under a severe foreign exchange crisis with falling reserves. The country is also grappling with a shortage of almost all essentials due to the lack of dollars to pay for the imports .
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