CALCUTTA, June 24: The Export Credit Guarantee Corporation (ECGC) of India expects to increase its business to cover 25 per cent of exports from 17 per cent now, chairman cum managing director Dev Mehta said here on Monday while addressing the Merchants Chamber of Commerce.

The ECGC has identified eight areas, where it will be concentrating to meet the target of 25 per cent exports' coverage. It will start off by opening new branches, appointing agents in rural areas and re-introducing one-man `settle- it- off' offices. Then it will restructure the premium rates. Responding to a request from S S Bagaria, the president of the chamber, Mehta said there was no scope for a reduction in the premium rates.

``At present we are charging seven paise, per year for every Rs 100. This is one of the lowest in the world. We cannot reduce it further. Instead we are thinking of enhancing it and providing better services. For small exporters there will be generalised structure, where cost of services will be low. It may, even differ with industries to meet their specific needs,'' Mehta said.

ECGC will also diversify into factoring, forfeiting, `selling of information' and warehousing. For factoring and forfeiting, it may enter into an informal tie-up with the Export Import Bank of India. Mehta also requested the Union government to open a Special Risk Fund, which the government can operate by itself. This fund can be used exclusively for countries that are not `safe' trading partners.

``There are some transactions which are unsafe but the government supports it for political reasons. The special risk fund will cover only these transactions and will be operated solely by the government,'' the chairman cum managing director of ECGC underlined.

Regarding settlement of a claim, Mehta said that ECGC is trying to clear claims within 90 days. ``The international standard is 45 days but we will not be able to do it so fast,'' he said. ECGC is also planning to launch a massive awareness programme. It has already increased its publicity budget from Rs 20 lakh to Rs 1 crore. It is also planning to organise training modules for exporters. Branch coordination committees are set up within ECGC, which will meet every month to review developments. The organisation has also decided to decentralise its activites and give more powers to the regional and branch offices. For debt recovery services, ECGC already has a tie-up with ABC Companies of United States for USA and Canada.

Similar tie-ups are also been looked into for other countries.

Mehta said that ECGC is also trying to enter newer sectors of Indian exports -- software, fashion items, perishable goods and gems and jewellery. The chairman sounded very optimistic about the proposed reforms in the export credit front. ECGC has also decided to restructure the country division. ``At present, we have five divisions, of which two to three are highly congested. We would like to increase it to seven or eight divisions,'' Mehta said.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.