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State Bank of India (SBI) has signed a loan agreement amounting to up to $1 billion with Japan Bank for International Cooperation (JBIC).
India’s largest bank, in a statement, said the ‘untied’ loan is intended to provide funds for manufacturers, suppliers and dealers of Japanese automobiles in India.
As per the statement, $600 million will be financed by JBIC and $400 million by other participating banks.
JBIC will provide a guarantee for the portion co-financed by the participating banks – SMBC, MUFG Bank, Mizuho Bank, Shizuoka Bank and Bank of Yokahama.
“The loan is intended to promote smooth flow of funds for the whole range of business operations of Japanese automobile manufacturers in India,” SBI said.
C Venkat Nageswar, Deputy Managing Director (International Banking Group), SBI, said: “It is a historic occasion for both SBI and JBIC, as for the first time we are entering into an untied loan.”
Masayuki Tanimoto , Managing Executive Officer of JBIC, said: “As per one of the surveys, India is the most favoured nation for Japanese investment, and this is one more step towards a strong relationship between Japan and India.”
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