The government approves the continuation of the National Export Insurance Account (NEIA) and the injection of Grant in Aid of Rs 1,650 crores over a five-year period. Injecting capital into the NEIA Trust will help unleash the enormous potential for project exports in the focus market.
Capital input into NEIA will generate revenue for the project’s huge export potential in the target market. This transfusion can be seen as part of various measures to revitalize the export sector.
Benefits of injection of capital
NEIA Trust’s capital input will help Indian Project Exporters unlock the huge potential for project export to target markets. Supporting the export of projects with Indian content from all over the country will improve production in India. With the contribution of the corpus of Rs 1,650 crores, the trust’s underwriting capacity will be improved, NEIA will be able to support project exports of 33,000 crores with full capacity, and the estimated domestic production will lead to an output of Rs 25,000 crores. Supporting the export of projects with Indian content from all over the country will improve production in India. Assuming India’s average share of 75% in the project, it is estimated that approximately 12,000 workers will move to the formal sector.
About NEIA Trust
In then year 2006, the NEIA trust was established to promote the export of strategically and nationally important projects from India. NEIA Trust promotes exports of medium- to long-term (MLT) / projects. The NEIA Trust also provides (partial / complete) support for MLT / project exports and ECGC-issued covers for Exim Bank for Buyer’s Credit (BCNEIA) in connection with project exports from India.
This promotes economically viable medium- to long-term exports, given the limitations of ECGC Limited to provide appropriate coverage on its own and the lack of reinsurance coverage for such exporters. Established by the Indian Government, NEIA aims to ensure the availability of credit risk compensation for projects and other high value exports that are desirable from a national interest perspective but cannot be adopted under conditions that do not affect the competitiveness of exports.