As Exim Bank has a significant exposure to Asian countries, its profits could be affected. A bank spokesman, however, said that its exposure to Indonesia specifically was not as high as in some other south-east Asian countries. The bank has been offering medium and long-term finance in the capital goods and technology sectors.

As for ECGC, it is turning cautious in extending insurance cover to exporters setting up projects in Indonesia. The corporation normally reimburses exporters 90 per cent of their losses if these arise owing to commercial or political risks.

A top ECGC official said: "We are carefully considering export projects toIndonesia on a case-to-case basis as the political turmoil will have an adverse impact on the export front."

A few months ago, ECGC downgraded the country's rating from `B' to `C', indicating a higher investment risk after the Asian currency crisis. "We are not going to revert back to the old rating as the situation has become adverse now," said a source.

The ECGC rating has four categories -- A, B, C and D. An `A' rating indicates that the risk of funding is negligible and `B' indicates no risk. `C' indicates that there could be risks involved in funding projects to these countries, whereas `D' indicates a very high risk.

The rating covers political risk, commercial risk and the corporation's relationship with a particular country.

Depending on the ECGC rating, exporters have to pay higher or lower premiums for insurance cover from the corporation. Premiums also vary depending on the terms of payment -- whether it is on cash against delivery or documents against acceptance.

ECGC officials say thata large percentage of the cover provided by the corporation comes under a standard policy, which covers the risk for goods exported on short-term credit not exceeding 180 days. This policy covers both political and commercial risks from the date of shipment, with Rs 25 lakh being the minimum turnover covered per annum.

The corporation also offer specific policies designed to protect domestic firms against payment risks involved in export on deferred payment terms, services rendered to foreign parties and construction works undertaken abroad. It also provides financial guarantees issued to banks in India to protect them from risks of loss involved in extending financial support to exporters at the pre-shipment and post-shipment stages.

It also offers other schemes like transfer guarantee, insurance cover for buyers' credit, lines of credit, overseas-investment insurance and exchange-fluctuation risk cover.