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Symbiosis Institute of Business Management


Project Proposal


Summer Internship Program

Name: Deepiga Vasudevan

Prn: 18021141036

Mobile no: 9952066061

Project Proposal

Export credit insurance is a policy offered by both government export credit
agencies and private entities to businesses that want to protect payment
risk.These risks include non-payment, currency issues and political unrest.
Not knowing where an exporter is sending their merchandise is a risk that can
potentially bankrupt a company. This insurance covers some of the possible
losses. Export Credit Guarantee Corporation of India Limited, (ECGC) is a
company wholly owned by the Government of India. It functions under the
administrative control of the Ministry of Commerce and is managed by a Board
of Directors representing Government, Banking, Insurance, Trade and Industry
primary objective is to promote country's exports by covering the risk of exports
on credit by providing insurance cover to Indian exporters against non-
realisation of export proceeds due to commercial or political risks; and giving
guarantee to banks and other financial institutions to enable them to extend
credit facilities to exporters on liberal basis. ECGC is performing well to assist
Indian exporters and bankers.
 Literature Review
“Export and Economic Growth” by B.N. Tripathy, states that exports are
engines of economic growth. The study has traced the theories on export by
Adam Smith, historical experience and an attempt was made on the analysis of
the role of Indian Economy. The author has expressed that Indian Economy has
always been growth led exports and strategy of export led growth. Mr B.N.
Tripathy has also pointed out that small countries with limited natural resources
are most likely to find economic growth can be accelerated by export
ECGC services to exporters - A study with reference to Coimbatore region. A.
Muthuswamy - 2005. The study has evaluated the business and financial
performance of ECGC (Export Credit Guarantee Corporation), utilization of
export finance and related problems faced by exporters. It has also suggested
that Reserve Bank of India to consider favourably the application for relaxation
of pre-shipment credit period suggesting simplification in export procedures.
The study has expressed that ECGC to take steps for promotion of export
business through conducting awareness programmes and seminars through
effective advertisement in business journals, magazines web etc.
Project Proposal

Exports and Economic Growth – An Empirical investigation by Nidugala has

analysed the impact of exports on economic growth for the period 1960 to 1989.
The study concluded that, the growth of manufactured exports had significant
positive relationship with GDP growth, while growth of primary exports hardly
has any influence of GDP growth. The reasons for this kind of shift in
relationship between export growth and GDP growth is: (i) higher level of
development, and (ii) change in the composition of exports in favour of
manufactured exports. It was observed that despite the import liberalization in
the 1980s, the Indian economy was also severely resource constrained. The
study suggested that there is need to deepen the reforms further to sustain the
current growth and attain higher levels of growth.
Garcia-Alonso, Levine and Morga (2004) analyse the role played by export
credit guarantees in encouraging exports to developing countries. They relate
export credit to moral hazards and export quality in their theoretical attempt.
Verifying the actual quality of the export product will limit its ability to
encourage trade through ECGs. Their result suggests that export credit
guarantee may encourage risk-averse firms to trade with countries which might
have political risks. The scope for trade may also decrease as the credit
guarantee may increase the incentive of firms to export low quality. That result
suggests us an interesting policy answer that excessive level of coverage will
have a negative impact on trade.
Over the years ECGC has come a long way in all its operational matrices too as
a commercial institution, understanding the market, changing requirements of
Indian exporters and making its services available to exporters across the
More importantly, as a non-life insurer, it also could successfully transform
itself into a modern insurance firm with niche base, meeting all regulatory
compliances and requirements.
“We strive to stay ourselves strong, aim to grow faster and improve our overall
efficiency level, “says Mr.Shankar,who has long years of experience in export
credit business, earlier being Executive Director of Exim Bank, one of India’s
largest export promotion institutions.Incidently , the government has also been
supportive and meeting its demand on time, he points out
Project Proposal

ECGC always tries to understand the changing needs of various classes of

exporters. It has time to time developed various export credit risk insurance
products to meet the requirements of Indian exporters and commercial lenders,
Mr Shankar points out
ECGC has strong and well defined systems and processes in place. Major
strength of ECGC, he says, lies in its committed and loyal workforce.
Officers are constantly trained on various aspects of business through seminars,
brainstorming organised by it for its workforce, are mostly participative in
nature for better results, says Mr Shankar
Sometimes they are also sent for programmes organised by outside agencies,
besides its own programmes with an aim to help them gain better feedback and
increase their knowledge of the area they handle. Staff attrition is very low,
which is major HR advantage for it.
AT ECGC business review is a continuous process.ECGC, through its long
experience and first-hand knowledge of the country risk, has developed
operational model with clear guidelines.
Recently ECGC also has started working on its own credit rating models for
overseas buyers of Indian goods, which will also enable Indian exporters to
understand the strength of overseas buyers.
It has prepared models of open cover and restricted cover lists. Under the open
cover its branches can decide on the exposure limit of buyers as per delegated
powers. The exposure limit is restricted in the case of restricted cover countries.
This operational model, while protecting interest of institution, sends a kind of
message to exporters about the strength of their overseas market.
Many times, it is difficult to get information about overseas buyers. Sometimes
ECGC has only their addresses. In many countries it depends on outside agency
for information.
For recovery it totally depends on overseas agents. Though ECGC is an
institution dealing with exporters ‘interest and foreign clients of Indian
exporters, it does not have a foreign office.
Project Proposal

“Now we are planning to open offices abroad, “he says. Establishment of

foreign offices will enable it to go for more effective recovery process and
understand the market better.
At the same time, it will also enlarge the panel of agencies who supply rating
reports on clients
In every sense ECGC is a dynamic organisation with a lean structure and high
level of manpower productivity
With roughly Re 1.75 crore per employee premium income and clean balance
sheet,ECGC also stands out to be dynamic commercial organisation that reaches
its clients through own network and also through alternate channels.
“Now we have branches/offices in all big cities and SME clusters across the
country” says Mr.Shankar who has many plans for institution’s long term
Against IRDA prescribed solvency margin of 1.5 %, it maintains 10.5%,
another sign of its strength as an insurer.

I. Project Proposed:
Implementing qualitative methods to generate reports and analyse various
policies customers require which also benefits the organisation henceforth
improving CRM.

II. Description of Project in Brief:

ECGC helps in the growth of exports from the country. It is, however, necessary
to periodically review the role of ECGC and the various products offered by it
to ascertain the modifications, if any, required to be made in them so as to make
them more focused to the needs of the exporters and banks with needed extra
support in difficult times; A comparative study on growing competition to the
Corporation from private players to examine the possibility of introducing new
Project Proposal

allied products which could play a catalytic role to achieve the main objective
of augmenting the country’s exports.

Issue of concern

Marketing efforts–ECGC, which is charged with the responsibility of

promoting the country’s exports, the importance of marketing efforts is often
not adequately realized or given its due importance. It is not only about
generating new business it is equally a big challenge to retain the existing
business. Thus the company should focus on many proactive measures to retain
the existing customers.

Role of brokers– Procurement of business through alternate channel is order of

the day. The broker plays a very important role in procurement of business. It
is very essential for the company to engage with the brokers for their business.
The company should also ensure that they are paid with attractive brokerage
commission to encourage them to bring good business to the company.

Simplification of the procedure for claim settlement–Care should be taken by

the company to settle the claims of their customers in a hassle free manner.
Towards this end, they have set certain simplified procedures for quick
settlement of claims up to certain value viz upto Rs.1 crores etc. care should be
taken to settle within a given time e.g. 10 days. This will go in a long way in
creating a positive image of the company as well the customers will be hugely
benefited by such measures.

Combining export credit insurance and post shipment credit cover–The two
products, namely credit insurance policy and post shipment cover, essentially
cover more or less the same risk cannot be brushed aside and a sincere effort
Project Proposal

needs to be made to eliminate or at least minimize the duplication between the

two. An easy way to solve this problem is to design a product which has the
benefits of both the export credit insurance and post shipment credit cover at the
cost of one.

Provision of credit insurance cover in foreign currencies–A large number of

foreign companies, including multinationals, have started their operations in
India. Their subsidiaries in India, which are also in need of credit insurance for
their exports, are generally not able to avail of ECGC’s policies, as they require
cover for their exports in foreign currencies. IF ECGC can offer credit
insurance cover in foreign currencies, many such subsidiaries could opt for it.
Such a facility can be availed of by the foreign subsidiaries of Indian companies
also. While the premium will be paid in foreign currencies, claims, if any, will
have to be paid in the foreign currencies as desired by the insured. ECGC will
have to design an appropriate product after taking the approval and necessary
clearances from RBI and IRDAI.

Group cover for members of export promotion councils–Another possible

product which can catch the imagination of the exporting community is to
provide a group cover for members of a body of exporters like an export
promotion council. It should be possible to design a policy which would
provide covers to all members of the Council at a particular centre for losses up
to a limit at a cost which should be significantly lower than the normal premium
Project Proposal

III. Objective of the Project

 Identify existing offerings provided by ECGC, Analyse issue of concern and
designing new Products for more opportunities in credit insurance.
 To know the policies covered under ECGC

 To know the performance of ECGC

 To know the commodity wise and country wise coverage of ECGC

Why it matters-To increase customer awareness, distribution of insurance

products, developing company image, improving customer service.

IV. Methodology
Qualitative Research Method for in-depth analysis of products offered by
ECGC compared to competitors and proposal of new products. The study would
be based on survey using questionnaires and convenient sampling method is
used. Information gathering from personal interactions along with field officers.
The data collected will be segregated based on policies. After the process of
segmentation, analysis would be carried out to understand respective

V. Schedule
The activity for the project includes meeting various exporters with field
officers on a regular basis and updated twice a week.
Project Proposal

VI. Limitations

 The study is also based on the Secondary Data, so there may be chance for
 Detailed analysis may not be possible in certain areas which was considered
highly confidential

VII. References:
1. www.ecgc.in
2. Research Reports.

Name of the Faculty Guide: Dr.Shyamsunder Chitta

Name of the Company Guide: ECGC Ltd

Date: 26.04.19 Deepiga Vasudevan