MIGA, ECGC plan political risk cover for overseas businesses

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Mumbai, Oct 30: Multilateral Investment Guarantee Agency (MIGA) — a World Bank affiliate — is negotiating a co-insurance facility with state-owned Export Credit Guarantee Corporation Ltd (ECGC) to provide political risk cover to India’s trade and investment abroad.

The political risk cover from MIGA includes any damage on account of civil disobedience, breach of contract and also currency fluctuation. “MIGA can share the insurance cover for a specific country, where ECGC perceives political risks to Indian trade and investments,” said executive vice-president, Motomichi Ikawa at a meet on ‘Emerging Risk Exposure - Political Risk Insurance’, organised by the Confederation of Indian Industry (CII) here on Tuesday. “We have held talks with ECGC and conveyed that MIGA can also reinsure the risk cover extended by the former,” he said. MIGA can provide cover up to $200 million per project and along with the co-insurer can cover up to $650 million per country. According to him, the global investment atmosphere is lacking confidence after the September 11 terrorist attack on the US and MIGA, from its side, will be proactive to facilitate the flow of foreign direct investment into developing countries.