RESOURCES OF THE EXIM BANKCentral

Section 13 of The Export-Import Bank of India Act, 1981

Notwithstanding anything contained in the Foreign Exchange Regulation Act, 1973 (46 of 1973) or in any other law for the time being in force relating to foreign exchange, the Exim Bank may, for the purpose of granting loans and advances under this Act, borrow, with the previous consent of the Central Government, foreign currency from any foreign State or from any bank or financial institution in any foreign country or otherwise.

Summary

The Exim Bank is allowed to borrow money in foreign currency from foreign countries.
It can also borrow from banks or financial institutions located in foreign countries.
These borrowings are permitted specifically for the purpose of giving out loans and advances under the Act.
The bank must get the permission of the Central Government before it borrows any foreign currency.
This power to borrow exists even if other foreign exchange laws, like the Foreign Exchange Regulation Act of 1973, say something different.

Practical examples

1On June 15, 2026, the Exim Bank receives permission from the Central Government to borrow 500 million U.S. Dollars from a large commercial bank in London to help fund new export projects.

2The Exim Bank enters an agreement with the government of Japan on October 10, 2026, to borrow 10 billion Yen so it can provide low interest loans to Indian companies importing high tech machinery.

FAQ

1. Who must approve a foreign currency loan before the Exim Bank can take it?

The Exim Bank must get the previous consent of the Central Government.

2. Can the Exim Bank borrow from a private bank in another country?

Yes, it can borrow from any bank or financial institution in any foreign country.

3. What can the Exim Bank do with the foreign currency it borrows?

It must use the borrowed foreign currency for the purpose of granting loans and advances under the Act.

Test yourself

Q1.Under Section 13 of The Export-Import Bank of India Act, 1981, whose consent is required before the bank borrows foreign currency?

Q2.For what specific purpose may the Exim Bank borrow foreign currency according to Section 13 of The Export-Import Bank of India Act, 1981?

Q3.According to Section 13 of The Export-Import Bank of India Act, 1981, which law's provisions are overridden regarding foreign exchange borrowing?

Q4.From which of the following can the Exim Bank borrow foreign currency under Section 13 of The Export-Import Bank of India Act, 1981?

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