The Export-Import Bank of India (India Exim) has extended a US$87mn line of credit to the Zimbabwean government for the renovation of the Bulawayo thermal power plant.

The 13-year loan has a three-year grace period and a repayment period of 10 years.

This is India Exim’s second credit line to the Southern African country, taking the total value to US$115.6mn. Its first loan, worth US$28.6mn, was extended in June 2013 for the upgrade of the Deka pumping station and river water intake system.

Under the terms of its credit lines, India Exim will reimburse 100% of the contract value to the Indian exporters upfront, upon the shipment of equipment and goods or the provision of services.

In a statement, Zimbabwean finance minister Patrick Chinamasa, said the revamping of the Bulawayo power station would help mitigate the country’s power woes and in turn improve industrial productivity.

He said the project was expected to take three years to complete.