Export-Import Bank of India (EXIM Bank)

The Export-Import Bank of India (EXIM Bank) is India’s premier specialised financial institution for promoting and financing the country’s international trade and overseas investment. Established to support exporters, importers, and Indian enterprises expanding abroad, EXIM Bank occupies a strategic position in India’s banking and financial system. Its operations have deep implications for export competitiveness, foreign exchange management, and the overall integration of the Indian economy with global markets.

Establishment and Institutional Background

EXIM Bank was established in 1982 under the Export-Import Bank of India Act, 1981 as a wholly government-owned financial institution. Its creation marked a shift towards institutionalised export finance in India, recognising the need for long-term, structured financial support beyond conventional commercial banking.
The bank functions under the administrative control of the Government of India and complements the roles of commercial banks by focusing on medium- and long-term international finance.

Objectives and Mandate

The primary mandate of EXIM Bank is to promote India’s foreign trade by providing financial assistance and advisory services. Its key objectives include:

• Financing exports and imports of goods and services.
• Supporting Indian companies undertaking overseas investment.
• Facilitating international trade finance and project exports.
• Strengthening India’s presence in global value chains.

Through these objectives, EXIM Bank acts as a policy-driven development finance institution aligned with national trade and industrial strategies.

Core Functions and Financial Assistance

EXIM Bank provides a wide range of financial products tailored to international trade requirements. These include:

• Pre-shipment and post-shipment export credit.
• Buyer’s credit to overseas importers of Indian goods and services.
• Supplier’s credit to Indian exporters.
• Project finance for turnkey and infrastructure projects abroad.
• Lines of credit to foreign governments, banks, and institutions.

These facilities reduce financing constraints and improve the global competitiveness of Indian exporters.

Role in Banking and Trade Finance

EXIM Bank plays a catalytic role in the banking system by supplementing commercial bank finance and sharing risks in international transactions. Its guarantees and refinancing support enable banks to extend export credit more confidently.
The bank also provides advisory services on international markets, export opportunities, and structuring of complex cross-border transactions, strengthening the institutional capacity of Indian businesses and banks.

Overseas Investment and Project Exports

A distinctive function of EXIM Bank is its support for Indian enterprises investing abroad. It finances overseas joint ventures, wholly owned subsidiaries, and acquisitions by Indian companies, contributing to outward foreign direct investment.
EXIM Bank is also a major financier of project exports in sectors such as power, transport, construction, and telecommunications, enabling Indian firms to compete for large infrastructure contracts globally.

Importance for the Indian Economy

Exports are a vital engine of economic growth, employment, and foreign exchange earnings. By providing long-term finance and risk mitigation, EXIM Bank supports export diversification and expansion into new markets.
Its lines of credit to developing countries not only promote Indian exports but also strengthen India’s economic diplomacy and South–South cooperation, reinforcing the country’s strategic global engagement.

Linkages with Policy and Regulation

EXIM Bank operates in close coordination with policymakers, commercial banks, and regulatory authorities, including the Reserve Bank of India. Its activities align with India’s foreign trade policy, export promotion schemes, and development cooperation initiatives.
The bank also collaborates with multilateral development banks and foreign export credit agencies to co-finance large international projects.

Risk Management and Challenges

Operating in international markets exposes EXIM Bank to credit, currency, and geopolitical risks. Managing these risks while maintaining developmental objectives is a key challenge. Global economic volatility, protectionist policies, and project execution risks require robust appraisal and monitoring mechanisms.
Balancing commercial viability with strategic national interests remains a central issue in its operations.