ns ran e in ndia         13.5
     (when a financial help comes in from the within               such projects are covered and underwritten on
     the bank/financial institution). Though such                  government account6 .
     apprehensions were cancelled by the Government.
      Presently, Rs. 1 lakh of depositors are protected/              nationaL export insurance
     insured by the DICGC—the limit remained
                                                                      account (neia)
     unchanged since 1993. Many countries revised
     their deposit insurance limits after the global               For facilitating the service of the ECGC (discussed
     financial crisis of 2008—upto US$ 2.5 lakh                    above), the Government of India did set up the
     in USA and US$ 1.15 lakh in UK (set around                    National Export Insurance Account (NEIA) in
     3-4 times of the per capita income of these                   March 2006 to promote medium- and long-term
     economies). Emerging economies like Brazil and
                                                                   export by providing credit insurance support in the
     China have set this limit at nine times of their per
                                                                   cases where ECGC was not able to provide credit
     capita income. In case of India it is still a little over
     its per capita income (which was estimated to be              cover on its own because of purely commercial
     Rs.1,11,782 at constant market price, as per the              reasons:7
     Economic Survey 2017-18 ).                                          (i) The corpus given to the account was Rs.
                                                                               66 crore, raised to Rs. 246 crore by 2007–
         export creDit Guarantee                                               08 and was enhanced to Rs. 2,000 crore
         corporation (ecGc)                                                    in the Eleventh Plan (2007–12).
     The overseas projects undertaken by the Indian                    (ii) Resources of the NEIA will be the corpus,
     companies face many political and commercial                              the premium income, interest income
     risks in the importing countries. To provide                              and recovery of all the claims paid.
     adequate credit insurance cover to such firms,                   (iii) As per the provision, an exposure equal
     the government has set up the Export Credit                               to ten times corpus can be taken by the
     Guarantee Corporation of India Ltd. (ECGC)                                NEIA.
     under the Ministry of Commerce and Industry,
                                                                        The NEIA can cover projects which fulfil the
     for medium- and long-term exports. But owing to
                                                                   following criteria:8
     its own limitations, at times it is difficult for ECGC
     to cover pure commercial risks in issues like long                  (i) The project by itself               should      be
     repayment period, the large value of contracts,                           commercially viable;
     difficult economic and political conditions of the                (ii) The project should be strategically
     importing country, together with the fact that                            important for India, with regard to
     reinsurance cover is generally not available for                          economic and political relationship of
     such projects.5 Many times such projects look                             India with the importing country; and
     necessary considering the economic and political
     relationship of India with the proposed importing                6.    As for example the USA, France, the UK and many
                                                                            other Euro-American economies underwrite such
     country. It means that in the absence of credit
                                                                            medium and long-term projects in the governments’
     insurance cover, the ability of Indian exporters to                    account. The SEIA also covers only medium- and
     go for such export projects is hampered. It should                     long-term export projects.
     be noted that in many developed economies                        7.    Announced while setting up the NEIA, Ministry of
                                                                            Commerce and Industry, Government of India, N. Delhi,
         5. Due to its underwriting constraint, the ECGC is unable          9 March, 2006.
            to cover such projects on its own.                        8.    Ibid.