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NIRVIK scheme

Topics Covered:

  1. Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth.


NIRVIK scheme


What to study?

For Prelims and mains: Key features and significance of the scheme.


Context: The Export Credit Guarantee Corporation of India (ECGC) is optimistic that the Nirvik scheme announced by the Union Government recently would give a fillip to export lending and insurance cover for export credit.



Export Credit Guarantee Corporation of India (ECGC) announced this scheme to ease the lending process and enhance loan availability for exporters. 


Key features of the scheme:

  1. Insurance cover guaranteed will cover up to 90% of the principal and interest.
  2. The increased cover will ensure that foreign and rupee export credit interest rates are below 4 percent and 8 percent respectively for the exporters.
  3. The insurance cover will include both pre and post-shipment credit. 
  4. The gems, jewellery and diamond (GJD) sector borrowers with limit of over Rs 80 crore will have a higher premium rate in comparison to the non-GJD sector borrowers of this category due to the higher loss ratio.
  5. For accounts with limits below Rs 80 crore, the premium rates will be moderated to 0.60 per annum and for those exceeding Rs80 crore, the rates will be 0.72 per annum for the same enhanced cover.
  6. It mandates inspection of bank documents and records by ECGC officials for losses exceeding Rs.10 crore as against the present Rs 1crore.
  7. The banks shall pay a premium to ECGC monthly on the principal and interest as the cover is offered for both outstandings.


Benefits of the scheme:

  1. It will enhance accessibility and affordability of credit for exporters.
  2. It will help make Indian exports competitive.
  3. It will make ECGC procedures exporter friendly.
  4. The insurance cover is expected to bring down the cost of credit due to capital relief, less provision requirement and liquidity due to quick settlement of claims.
  5. It will ensure timely and adequate working capital to the export sector.


Sources: the Hindu.