Government-owned ECGC on Monday said it has modified the insurance cover category for Indian exports to Russia, under which revolving limits are approved on a case-to-case basis, amid the ongoing conflict between Russia and Ukraine.
The Export Credit Guarantee Corporation (ECGC) in a communication has said that ''based on the near-term commercial outlook, it has been decided to modify the country-risk classification of Russia under the short-term and medium and long-term with effect from February 25.'' Revising its underwriting policy on Russia, ECGC has now put that country in Restricted Cover Category (RCC-I) from the earlier 'Open Cover' category.
Open cover categories enable policyholders to obtain cover on a more liberalised basis. In a press release, the corporation clarified that coverage on export to Russia has not been withdrawn.
''In view of the prevailing situation, ECGC carried out a review of the country risk rating of Russia as per its extant underwriting policy. Accordingly, w.e.f (with effect from) February 25, 2022, the cover category of Russia has been modified from Open Cover to RCC-I for which revolving limits (normally valid for a year) are approved specifically on a case to case basis,'' it said.
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It is further clarified that this change has been made to ensure that ECGC is able to assess and monitor the risks covered under its export credit insurance policies and to place appropriate risk mitigation measures.
The measure, it said, will also enable the exporters / banks in India in assessing the export payment realization prospects from buyers and/or banks in Russia.
''The customers have been suitably advised to contact their servicing branch of ECGC for cover on shipments to Russia. ECGC continues to monitor the situation and further review of the underwriting policy will be undertaken based on future developments,'' it added.
India's exports to Russia stood at USD 2.65 billion in 2020-21. The exports to Ukraine during the same period was USD 451 million.