The Export Credit Guarantee Corporation of India (ECGC) has reported a 29.5 per cent growth in net profit at Rs 46.04 crore for the year ended March 31, 2002 against Rs 35.55 crore in 2000-01.
The corporation's premium income (income from operations) stood at Rs 338 crore (Rs 330 crore in 2000-01) and income from investments (other income) was Rs 160 crore (Rs 150 crore). Total expenditure incurred in the reporting FY was Rs 43 crore (Rs 30 crore).
"Growth in premium income was flat as export growth was almost negligible last financial year," said P M A Hakeem, chairman and managing director.
In 2001-02, ECGC recorded the highest-ever claim settlement amounting to Rs 487.12 crore against Rs 212.49 crore in the previous year. Claims charged to the profit & loss account stood at Rs 362 crore (Rs 338 crore) and provisions made were lower at Rs 800 crore (Rs 908 crore).
The corporation, which is a government enterprise under the administrative control of the commerce ministry, made recoveries of Rs 26.76 crore (Rs 21.45 crore).
With a view to equip the corporation with greater underwriting capacity and face competition, the government had upped its capital from Rs 340 crore to Rs 390 crore in 2001-02. The capital will go up by around Rs 60 crore in 2002-03. The government plans to capitalise ECGC at Rs 800 crore by the end of the tenth plan (2007).
"With the opening up of the insurance sector to private players we no longer enjoy monopoly in our line of business. Hence we are gearing up by improving our services," said Hakeem.
Meanwhile, the corporation has come out with a first of its kind product whereby it will indemnify the loss owing to a letter of credit (LC) discrepancies in addition to political and commercial risks. The actual loss including loss on account of reshipment or due to sale to an alternate buyer will be paid subject to a ceiling of 25 per cent of the invoice value.
ECGC has tied up with the French credit guarantee agency Coface for offering multinationals operating out of India the agency's global policy. The policy will cover MNCs exports from India; their exports to third countries; and domestic sales.
