Financing And Risk Coverage Of The Venture

Financing and risk coverage of the venture Financing of exports of Jaipur handicrafts is done majorly by the export – import bank of India (EXIM bank ). FINANCE FOR JAIPUR HANDICRAFTS Exim bank has helped Jaipur Handicrafts in the following ways :Term • • • • • •

Finance Project Finance Equipment Finance Import of Technology & Related Services Domestic Acquisitions of businesses/companies/brands Export Product Development/ Research & Development General Corporate Finance

Working Capital Finance Working Capital Term Loans [< 2 years] ○

Long Term Working Capital [upto 5 years]

○ Export Bills Discounting ○ Export Packing Credit ○ Cash Flow financing •

Non-Funded ○ Letter of Credit Limits ○ Guarantee Limits

Export Finance •

Pre-shipment Credit

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Post Shipment Credit

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Buyers' Credit

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Suppliers' Credit [including deferred payment credit]

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Bills Discounting

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Export Receivables Financing

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Warehousing Finance

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Export Lines of Credit (Non-recourse finance)

Equity Participation (In Jaipur Handicrafts)

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To part finance project expenditure(Project, inter alia, includes new project/ expansion/ acquisition of business/company/ brands/research & development)

CONFIRMATION OF LETTERS OF CREDIT (L/C) BY EXIM BANK UNDER THE GLOBAL TRADE FINANCE PROGRAM (GTFP) OF THE INTERNATIONAL FINANCE CORPORATION (IFC), WASHINGTON DC. Features of the Program •

The program currently covers 74 countries of IFC's operation listed below and Exim Bank may confirm the L/Cs & other trade instruments issued by pre-approved banks for supporting Jaipur handicraft's exports to these countries: Afghanistan

DR Congo Mali

Seychelles

Albania

Ecuador

Malta

Sierra Leone

Angola

Egypt

Mauritania

South Africa

Argentina

Gambia

Mauritius

Sri Lanka

Armenia

Georgia

Mexico

St. Lucia

Azerbaijan

Ghana

Moldova

Syria

Bangladesh

Guatemala Mongolia

Tajikistan

Belarus

Haiti

Tanzania

Benin

Honduras Nepal

Togo

Bhutan

Indonesia Nicaragua

Turkey

Bolivia

Jordan

Uganda

Brazil

Kazakhsta n Nigeria

Ukraine

Burkina Faso

Kenya

Pakistan

Uruguay

Burundi

Kosovo

Papua New Guinea

Vietnam

Cambodia

Lebanon

Paraguay

West Bank

China

Liberia

Peru

Yemen

Costa Rica

Madagasca r Rwanda

Cote d'Ivoire

Malawi

Mozambique

Niger

Russia

Zambia

Dominican Republic

Maldives

Senegal

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Exim Bank’s L/C confirmation will cover the risk of non-payment by the Issuing Bank.

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Pricing : The fee payable to Exim Bank (including fee payable to IFC) for adding confirmation to the L/C will be advised by Exim Bank along with the approval for confirmation of L/Cs and other trade instruments. The fee will be payable before confirmation of instruments by Exim Bank.

How it works •

Under the program, an importer of Jaipur handicraft goods in any of the above countries will approach a bank for opening an L/C. The L/C Issuing Bank should be on IFC’s list of pre-approved banks. Either the L/C Issuing Bank or Jaipur handicrafts may request confirmation of the L/C from Exim Bank, as per the attached Application Form. Jaipur handicrafts are welcome to discuss the transaction before sending a formal request for L/C confirmation to Exim Bank.

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Exim Bank will convey availability or otherwise for confirmation of the L/C and, if agreed to confirm, the fee payable by the Jaipur handicrafts / L/C Issuing Bank. L/C will be governed by UCPDC-600.

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L/C Issuing bank shall not, without Exim Bank’s prior written consent, amend the terms of the L/C.

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Jaipur handicrafts will ship the goods covered under the contract and shall present the documents for negotiation to his bank. The Negotiating/ Paying Bank will ensure that the documents are as per the terms of the L/C and shall make payment under the L/C to the Indian exporter. The Negotiating/Paying Bank will forward the documents to the L/C Issuing Bank. Negotiating/Paying bank shall keep Exim Bank informed on each disbursement made to the Indian exporter under the L/C and each claim for payment made to the L/C Issuing bank and amount received by the Negotiating/Paying Bank from the L/C Issuing bank in settlement thereof, till retirement of the L/C.

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Exim Bank can also be the negotiating bank.

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In the event the L/C Issuing Bank fails to reimburse the Negotiating/Paying Bank, Exim Bank will pay the Negotiating/Paying Bank as per the terms and conditions of L/C confirmation.

EXIM BANK’S PARTICIPATION IN GLOBAL TRADE FINANCE PROGRAME OF INTERNATIONAL FINANCE CORPORATION FLOW CHART OF TRANSACTION MECHANISM FOR L/C CONFIRMATION

Exim Bank offers a diverse range of information, advisory and support services, which enabled Jaipur handicrafts to evaluate international risks, exploit export opportunities and improve competitiveness.