Bridging The Gap
Trade finance is a critical element for cross-border trade, and in many cases the movement of goods across borders, particularly in emerging markets, cannot occur without it. However, trade finance remains vulnerable to economic crises despite being a low-risk asset class. In sync with the global trade demands and the growing need after the onset of the pandemic, there has been a felt need for a more robust trade finance programme.
With this backdrop, India Exim Bank has christened a new trade facilitation initiative, Trade Assistance Programme (TAP). Under TAP, India Exim Bank provides support through credit enhancement to trade instrument(s), thereby enhancing the capacity of commercial banks to support cross-border trade transactions involving untapped markets, where trade lines are constrained or where the potential has not been harnessed, and transactions may not materialise in the absence of such support.
Objectives:
- i. Create an enabling environment for counterparties in settlement of trade transactions;
- ii. Support incremental exports by accessing identified untapped markets;
- iii. Provide market entry mechanism, while enhancing the geographical coverage for exporters, including MSMEs;
- iv. Provide risk coverage for challenging international trade transactions; and
- v. Enable local banks in target countries in establishing working partnerships with commercial banks in India.
