HSBC India and UK Export Finance (UKEF), the United Kingdom’s export credit agency, intend to establish a financing programme of up to £100 million to support Indian Micro, Small and Medium enterprises (MSMEs) and corporates for financing their imports from the UK.
This partnership is expected to enhance the availability of credit for Indian MSMEs and boost trade ties between the two countries.
HSBC India and UKEF on Thursday signed a Letter of Intent (LoI) to enable them to work together on opportunities relating to UKEF’s guarantee-backed structures. HSBC India and UKEF will work closely to originate, structure and extend financing and credit facilities to Indian MSMEs.
Commenting on this announcement, Hitendra Dave, CEO, HSBC India, said, “The partnership with UKEF will help leverage our inherent synergies and boost trade and economic ties between India and UK”.
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MSMEs have emerged as a mainstay of innovation and growth in India and are the driving force behind the nation’s growth aspirations, he said.
MSMEs in India are eager to grow, internationalise and adopt best global practices to compete in a globally connected world. “Given our large franchise in India and our global strengths, we are ideally placed to support the ambitions of these small businesses through our partnership with UKEF”, Dave added.
Tim Reid, CEO, UK Export Finance, said, “UK exports offer a wealth of opportunity for buyers in the Indian market. This partnership sees us explore new ways to help Indian businesses — from SMEs to large corporates — access best-in-class goods and services from the UK.”
Harjinder Kang, HM Trade Commissioner for South Asia and Deputy British High Commissioner, Western India, said, “MSMEs make up an important part of both the UK and India’s economies, actively contributing to our stated goals of doubling trade by 2030. With more than 600 UK companies already finding success in India, the opportunities for UK exporters in India are huge. This partnership between UKEF and HSBC India will further support the ambition of mobilising investment into India of up to £3 bn by 2025.”
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India was UK’s 12th largest trading partner in the four quarters to the end of Q2 2023, accounting for 2.1 per cent of total UK trade.
In 2021, around 7,500 UK SMEs, with around 3,17,300 employees, exported goods worth £1.2 billion to India, accounting for 85 per cent of all UK businesses exporting goods to India and 28 per cent of the total UK goods exports to India .
Providing enhanced financial access and developing an ecosystem that increases the productivity of SMEs and their competitiveness is crucial to achieving broad-based growth.
