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Export credit agency ECGC reported a 53 per cent jump in net profit at ₹276 crore in the financial year ended March 31, 2016 as against ₹180 crore in the year-ago period.
The profits are up despite the Corporation paying higher claims of ₹1,122 crore (₹590 crore in the previous financial year) to banks and exporters and setting aside more as claim provision (₹1,249 crore in FY2016 vs ₹897 crore in FY2015).
Robust investment income of ₹633 crore (₹544 crore) supported the wholly-owned government entity’s bottomline.
Global economic slowdown had a cascading effect, with overseas buyers defaulting on payments to Indian exporters and the latter, in turn, failing to pay banks, thereby triggering the insurance claims.
Geetha Muralidhar, Chairman-cum-Managing Director, said ECGC plans to increase its cover for India’s exports from the current 8 per cent of total exports to 12 per cent over the next four to five years.
Steps taken towards this end include reducing the premium rates by 17 per cent on an average on direct policies taken by exporters and policies taken by financing banks under export credit insurance cover with effect from April 1, 2016 and simplifying procedures for claims settlement, she added.
To step up insurance coverage of exports, ECGC has sought about ₹300 crore capital infusion from the government, Muralidhar said. The Corporation’s paid-up capital stands at ₹1,300 crore.
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