- Region: Asia
- Machinery and Equipment
- Export Loans
September 18, 2012
- The Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Okuda) signed on September 14 a buyer's credit agreement amounting to about 3.3 billion yen (JBIC portion) with GAIL (India) Limited (GAIL)*1. This loan is cofinanced with The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU), with Nippon Export and Investment Insurance (NEXI) providing Buyer's Credit Insurance for the portion cofinanced by BTMU. The overall cofinancing amount is about 5.4 billion yen.
- Among the petrochemical plants operated and maintained by GAIL in India, a project is being undertaken to increase production capacities in the ethane and propane production plants (Vijaipur, Madhya Pradesh) in the upstream process and the polyethylene production plant (Pata, Uttar Pradesh) in the downstream process. The project is expected to increase the production capacity of the final product, polyethylene, from the present 410kt per year to 810kt by 2014. The loan will finance GAIL for procurement of plant-related equipment from Japanese companies*2, in order for GAIL to increase the capacities of these petrochemical plants.
- India, with a population of about 12.1 billion, has vigorous domestic demand. Against this backdrop, further growth is projected in its petrochemical sector. JBIC support for Japanese exports of petrochemical plant-related equipment in this project will contribute to creating business opportunities for Japanese companies, and maintaining and improving the international competitiveness of Japanese industries in the petrochemical sector.
- JBIC will continue to actively support Japanese companies in the export of machinery and equipment, as well as overseas business deployment, by drawing on its various financial facilities and schemes for structuring projects and performing its risk-assuming function.
- *1 GAIL is a state-owned company whose 57.35% equity share is owned by the Indian government and it conducts business operations under the jurisdiction of India's Ministry of Petroleum and Natural Gas. GAIL is India's largest natural gas seller, accounting for 50% of the total domestic sales of natural gas, and also one of the leading petrochemical companies, accounting for 21% of the total domestic production of polymers.
- *2 The equipment to be exported includes a compressor-driving turbine (manufactured by Elliott Ebara Turbomachinery Corporation ( Elliott Group), a cracked gas compressor train package (Mitsubishi Heavy Industries Compressor Corporation), radiant tube assemblies (Kubota Corporation), a vent recovery compressor (The Japan Steel Works, Ltd.), and a cycle gas compressor (Kobe Steel, Ltd.).