Mumbai, Sep 30 (PTI) The government's decision to infuse Rs 4,400 crore in state-owned credit insurance provider ECGC Ltd and its listing through an initial public offering will increase the company's underwriting capacity, its Chairman and Managing Director M Senthilnathan said on Thursday.

The Cabinet on Wednesday approved the Rs 4,400-crore capital infusion to ECGC Ltd over five years (FY2021-22 to FY2025-26).

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The government also approved the continuation of the National Export Insurance Account (NEIA) scheme and an infusion of Rs 1,650 crore grant-in-aid over five years.

"The approved infusion along with efforts made to suitably synchronise with the listing process of ECGC through the initial public offering (IPO) will increase the underwriting capacity of ECGC to support more exports," Senthilnathan said.

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ECGC Ltd is a wholly-owned central public sector enterprise (CPSE) set up to improve the competitiveness of exports by providing credit risk insurance and related services for exports.

Senthilnathan said the capital infusion in ECGC will enable it to expand its coverage to export-oriented industry particularly the labour-intensive sector.

The approved amount will be infused in instalments, thereby increasing the capacity to underwrite risks up to Rs 88,000 crore and this will enable ECGC to issue covers that can support additional exports of Rs 5.28 lakh crore over the five-year period, he said.

"This will help ECGC provide an insurance cover to around 25,000 exporters from the current level of 12,000 exporters, most of which are small exporters," he said.

The capital will also enable ECGC to diversify its product portfolio and provide cost-effective credit insurance helping exporters to gain a stronger foothold in the difficult markets, he said.

Currently, ECGC provides cover to 239 countries across the globe and the capital infusion will help in improving the competitive position of Indian exporters in the international markets.

Senthilnathan said the government will also provide a grant-in-aid of Rs 1,650 crore to NEIA Trust, which will increase its underwriting capacity by Rs 33,000 crore. It will also support an estimated output of Indian manufactured goods to the tune of Rs 25,000 crore. HRS hrs

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