Union Cabinet on Thursday approved a pact between Export-Import Bank of India (Exim Bank) and BRICS-promoted New Development Bank (NDB), along with other development financial institutions of member nations, with an aim to strengthen trade and economic ties.
The Cabinet, chaired by Prime Minister Narendra Modi, has given its approval for signing of a Memorandum of Understanding (MoU) on general cooperation with NDB through the BRICS Interbank Cooperation Mechanism by Government at the level of Secretary, Department of Economic Affairs/ Export Import Bank of India, an official release said.
There is no financial implication involved with signing of the MoU, it added.
“The proposal will enhance trade and economic relations among the BRICS countries…The participating institutions from the BRICS nations will be benefited by this MoU,” the release said.
The MoU is a non-binding umbrella agreement aimed at establishing a cooperation framework in accordance with the national laws and regulations, besides skills transfer and knowledge sharing amongst the signatories.
Further, the release said that establishment of the NDB reflects the close relations among the BRICS countries and provides a powerful instrument for increasing their economic cooperation and help India play an enhanced international role.
“Therefore, keeping in view the strategic relevance of cooperation for sustainable development and inclusive economic growth, the signing of MoU is necessary in the context of cooperation extended by the members in various forms for promoting and facilitating trade of goods and services as well as investments in mutual projects among the BRICS countries,” the release, issued after the Cabinet meeting, said.
Five banks from the BRICS nations had established the BRICS Interbank Co-operation Mechanism to enhance trade and economic relations amongst the member countries and enterprises.
The BRICS Interbank Co-operation Mechanism has proposed to sign an MOU on general cooperation with the NDB.