The country’s largest lender, State Bank of India, has raised $ 1 billion from it Japan Bank for International Cooperation (JBIC) to provide loans to the supply chain of the Japanese auto industry in India.
SBI signed a loan agreement with JBIC, bringing the total facility to $ 2 billion. It signed a similar agreement for $ 1 billion in October 2020, SBI said in a statement. Bank has not disclosed the terms of the agreement, including the rent and interest charged for the loan facility.
The virtual signing ceremony was held in the presence of Dinesh Khara, Chairman, SBI along with senior executives from SBI, Hayashi Nobumitsu, Deputy Governor (JBIC), and Ayukawa Kenichi, CEO and MD of Maruti Suzuki.
The loan is in the form of refinancing against the funding support provided to manufacturers, suppliers and dealers of Japanese cars in India. These companies are recovering from the reduced car sales caused by the COVID-19 pandemic. The funding will support the Indian government’s ‘Make in India’ initiative.
Dinesh Khara, Chairman, SBI said: “The Covid 19 crisis has caused a significant shock to global trade, disrupted production lines and depressed global demand. This partnership (between SBI and JBIC) will help the bank extend the credit facility to the entire supply chain at a time when people prefer personal transportation.
JBIC is a policy-based financial institution, wholly owned by the Japanese government, with the aim of contributing to the healthy development of Japan, the international economy and society.