Indian bank ups Kenya lending to Sh33bn as it opens Nairobi office
From left: India Exim Bank Managing Director Harsha Bangari, Ministry of Finance Secretary to the Government of India Vivek Joshi, Prime Cabinet Secretary Musalia Mudavadi and High Commissioner of India to Kenya Namgya Khampa greet one another during the Inauguration of India Exim Bank’s East Africa Representative Office in Nairobi on May 31, 2024.
The Export-Import Bank of India will increase its lending to Kenyan businesses to Sh32.5 billion after opening a representative office in Nairobi on Friday, in efforts to bolster the country’s trade with the region.
Increasing its lending facility to Kenyan enterprises is among the issues agreed upon when the bank launched the bid to set up an East Africa representative office in Nairobi last year, Prime Cabinet Secretary Musalia Mudavadi revealed.
Mudavadi, who is also the Foreign and Diaspora Affairs cabinet secretary, said the State-owned Indian trade financier is already lending to Kenyans, but did not disclose how large its loan book to Kenyans currently is.
“The India Exim Bank confirmed through the Prime Minister Modi that they were going to expand the credit facility to $250 million (Sh32.5 billion) as an immediate facilitation to Kenyans,” Mudavadi said during the opening of the representative office in Nairobi Westlands on Friday.
This agreement was reached during President William Ruto’s State visit to India last year, when the discussions and conclusions to set up the representative office for East Africa in Nairobi was reached.
Vivek Joshi, secretary of the Department of Financial Services in India’s Ministry of Finance, said the representative office, which will serve 11 countries in the region, is meant to bolster trade between his country and East Africa.
“I’m sure that this new office by India’s Exim Bank will augment India’s relationship with these economies while taking it to greater heights in terms of new businesses, greater opportunities, while building relationships,” Dr Joshi said.
The representative office will serve Kenya and 10 other countries in the region: Burundi, the Democratic Republic of Congo, Republic of Congo, Djibouti, Eritrea, Ethiopia, Rwanda, Sudan, Tanzania, and Uganda.
India currently enjoys a positive trade balance with all these countries, with the total trade surplus between them amounting to Sh757 billion ($5.8 billion) in 2022, meaning India benefits more from trade with the region than the individual countries.
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Tanzania is currently India’s largest trade partner in the region, having accounted for over 43 percent of exports from the Asian country to the region in 2023, followed by Kenya, whose purchases from India accounted for 31.4 percent of its exports to East Africa.
For Kenya, India is the second largest import source after China, with total goods and services bought from the country last year amounting to Sh269 billion, according to data by the Kenya National Bureau of Statistics.
