Module: | MODULE A: INTERNATIONAL BANKING
Q169: Consider the following statements regarding the establishment and ownership of the Export-Import Bank of India:
1. The Export-Import Bank of India was established in 1982 under the Export-Import Bank of India Act of 1981.
2. It operates as a wholly-owned entity of the Government of India.
3. Its primary mandate is restricted solely to the regulation of foreign exchange markets in India.
Which of the statements given above is or are correct?
2. It operates as a wholly-owned entity of the Government of India.
3. Its primary mandate is restricted solely to the regulation of foreign exchange markets in India.
Which of the statements given above is or are correct?
✅ Correct Answer: A
🎯 Quick Answer:
Option A is correct because only statements 1 and 2 are accurate.Structural Breakdown: Structurally, it is a statutory corporation completely owned by the Government of India.
It is managed by a Board of Directors that includes representatives from the Government, the Reserve Bank of India, and the export community.
Statement 3 is incorrect because the regulation of foreign exchange markets is the statutory mandate of the Reserve Bank of India under the Foreign Exchange Management Act of 1999, whereas the Export-Import Bank functions purely as a lending, advisory, and export-promoting agency.
Historical Context: The bank commenced operations in March 1982, taking over the export finance functions previously handled by the Industrial Development Bank of India.
Causal Reasoning: The creation of a distinct Export-Import Bank was driven by the causal need to have a dedicated institution that could provide specialized, long-term credit to export-oriented industries, thereby boosting India's foreign exchange earnings and integrating the domestic economy with global markets.