Kenya to get $45mn credit line from India to boost its manufacturing sector

Prime Minister Narendra Modi who is on a four-nation tour of Africa that is part of a policy push to make India a more global player, economically and diplomatically on Monday extended a $45 million credit line to Kenya via India’s Export Import Bank (Exim Bank) to revive The Rift Valley Textile Industry (Rivatex) and other smaller industries.

Modi during a news conference with Kenyan President Uhuru Kenyatta said that India is Kenya’s largest trading partner and the second largest investor here. There is a potential to achieve much more.

Kenyatta said that out of the $ 30 million of the funds would be used to revive Rift Valley Textiles Factory, which went out of business in 2000 as mismanagement of the cotton sector led to Kenyan production to collapse. The factory is owned by a local university.

Exim Bank will release 1.5 billion shillings to go to the Industrial Development Bank for lending to small and medium enterprises.

Following the meeting by India’s Prime Minister Narendra Modi and President Uhuru Kenyatta, Kenya and India are now set to tighten trade bilateral relations.

Speaking after bilateral talks and after signing of agreements at State House, Nairobi President Uhuru Kenyatta indicated that the financing deal is an indication of the strong ties between the two countries with expectations that the two countries can collaborate in other areas.

The two leaders signed seven agreements on Defence Cooperation, Cooperation in the field of National Housing Policy Development and Management, agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to taxes, MoU between Bureau of Indian Standards and Kenya Bureau of Standards, Agreement on Exemption of Visa for holders of Diplomatic Passports, Line of Credit Agreement for US$ 15 million to IDB Capital Limited, for development of small and medium enterprises [SMEs] and the Line of Credit Agreement for US$ 29.95 million to the Government of Kenya for upgrade of Rift Valley Textiles Factory [RIVATEX).

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