Monday, June 24, 2024

India urges G20 to find ways to shrink widening trade finance gap

The first G20 Trade and Investment Working Group (TIWG) meeting under India’s Presidency started in Mumbai on Tuesday with Sunil Barthwal, Secretary, Department of Commerce emphasising the need for trade finance cooperation among member countries to help reduce the widening trade finance gap.

“Trade finance gap is widening.” Mr. Barthwal said, speaking at the International Conference on ‘Trade Finance, organised by the Export Credit Guarantee Corporation of India (ECGC) and India’s EXIM Bank. “As estimated by ADB, the gap which was $1.5 trillion in 2018 has now increased to $2 trillion,” he added.

Delegates from the member countries, industry and academic experts from across the world attended the conference aimed at furthering an exchange of ideas in the domain of trade finance.

Observing that it was the right time to discuss the issues facing trade finance, the Commerce Secretary underscored the importance of finding the right solutions.

Panelists discussed the role banks, financial institutions, development finance institutions, and export credit agencies could play to identify the gaps and address the challenges in the trade finance arena amidst the uncertain global trade landscape.

The need to accelerate digitalisation as well as the adoption of fintech solutions for improving access to trade finance, was also stressed.

“Digitalisation of international trade is possibly an effective solution towards achieving cost reduction in trade and trade finance,” the Commerce Ministry said in a statement. “The challenges to be addressed in digitalising trade were identified as international cooperation in harmonising definitions, standards and data sharing across the borders digitally,” it added.

The panellists recommended that all nations should endeavour to adopt enabling legislation in the next few years to achieve paperless international trade.

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