Consider the following statements with respect to the Export Credit Guarantee Corporation(ECGC).
1. It is a market leader in India with around 85% market share in the Export Credit Insurance market.
2. The Insurance Regulatory and Development Authority of India is its nodal agency.
Which of the statement/s is/are correct?
A. 1 Only
B. 2 Only
C. Both 1 & 2
D. None
Answer: 2 Only
Explanation:
The Cabinet approved an infusion of over ₹6,000 crore into entities providing export insurance cover to facilitate additional exports worth over ₹5.6 lakh crore over the next five years. It also approved the listing of state-run Export Credit Guarantee Corporation (ECGC) on the stock exchanges.
Export Credit Guarantee Corporation(ECGC)
Establishment:
- The ECGC Ltd is wholly owned by the Ministry of Commerce and Industry.
- The Government of India had initially set up the Export Risks Insurance Corporation in 1957.
- After the introduction of insurance covers to banks during the period 1962-64, the name was changed to Export Credit & Guarantee Corporation Ltd in 1964.
- It was changed to ECGC Ltd in August 2014.
Objectives:
- ECGC was established to promote exports by providing credit insurance services to exporters against non-payment risks by the overseas buyers due to commercial and political reasons.
Significance of Capital infusion:
- It will enable it to expand its coverage to export-oriented industries, particularly labour-intensive sectors.
- ECGC is a market leader with around 85% market share in the export credit insurance market in India and provided support to exports worth Rs 6.02 lakh, or 28% of merchandise exports, in FY21.
- Micro, Small and Medium Enterprises (MSMEs) form 97% of the client base of ECGC.
- The process of listing ECGC on the stock market is also being initiated so that it can raise more funds.
UPSC Daily Current Affairs Quiz Test 2 October 2021 Click Here
