The Export-Import Bank of the United States has sought powers from the Reserve Bank of India (RBI) for recovery under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act. Its application is pending with RBI. Fred P Hochberg, chairman and president of US Exim Bank, said the bank had held discussions on the issue with RBI and the finance ministry.
Hochberg, however, didn’t specify when the bank had approached RBI and what RBI’s response was.
Hochberg said US Exim Bank, the official export credit agency of the US government, was seeking a playing field on a par with Indian banking entities.
Though the bank didn’t have an office in India, the US government had embassies in the country, he told reporters on the sidelines of an event organised by the US-India Importers’ Council here today.
The US Exim Bank enables companies from that country to turn export opportunities into sales, helping maintain, as well as create jobs in the US. The bank’s portfolio in India has risen to $8.5 billion from $4 billion in 2006.
The Sarfaesi Act came into effect in 2002. It allows banks and financial institutions to auction properties in case borrowers fail to repay loans. Meanwhile, the US Exim Bank has signed an agreement with ICICI Bank to extend a $500-million credit line to the Indian bank. ICICI Bank would lend the funds to infrastructure projects and small and medium enterprises.