These 3 countries which were earlier a part of the “open cover group” have been converted to “restricted cover group”.
This has left exporters in India unprotected and at a high risk. According to media reports, exports to these countries run over Rs. 11,000 crore as of last year. These exports include rice, mangoes, petroleum products etc.
ECGC was established by the Indian Government in 1957 to cover risk of exporting on credit. Along with other functions it provides a range of credit risk insurance covers to exporters against loss in export of goods and services.
Exporters are unhappy with this move as this is the time when they need this cover the most. According to the circular dated 7th February, all the credit limits on the buyer stands cancelled.