Bridging Finance and International Trade: A CAMELS-Based Insight into the Strategic Role of India’s EXIM Bank

Abstract

The Export-Import Bank of India (EXIM Bank) plays a vital role in facilitating India's international trade by providing export credit, project finance, overseas investment support, and Lines of Credit. This connection helps domestic enterprises engage with global markets. In light of India's export-led growth strategy and its increasing integration with the global economy, assessing the financial health of EXIM Bank is essential to understanding its capacity to support trade expansion. This study evaluates the financial performance of EXIM Bank and its relationship with India’s international trade performance from 2020-21 to 2024-25, utilising the Capital Adequacy, Asset Quality, Management Efficiency, Earnings, Liquidity, and Sensitivity to Market Risk (CAMELS) framework. The analysis relies exclusively on secondary data sourced from EXIM Bank's annual reports, publications from the Reserve Bank of India, and reports from the Ministry of Commerce and Industry. Key financial ratios for each CAMELS component were computed and analysed using both ratio analysis and trend analysis techniques. The results show a consistent improvement in EXIM Bank’s financial performance over the study period, evidenced by the growth in total business from ₹2,377 billion in 2020-21 to ₹3,979 billion in 2024-25, along with a significant rise in Profit After Tax from ₹2,540 million to ₹32,432 million. The bank's capital adequacy consistently exceeded regulatory requirements, while the Net Non-Performing Assets ratio declined significantly, indicating better asset quality and credit risk management. Furthermore, improvements in Return on Assets and profit per employee reflect enhanced profitability and management efficiency. These financial trends align with the recovery and expansion of India's export activities in the post-pandemic period. The study concludes that EXIM Bank’s financial resilience, prudent risk management, and operational efficiency have bolstered its capability to support India’s international trade, thereby reinforcing its strategic role in promoting export-led growth, external sector stability, and global economic integration.