Commerce Ministry seeks Rs 2,500 cr to settle debts of interest rate equalization scheme

New Delhi, May 18 (KNN) The Ministry of Commerce has asked for an additional fund of Rs 2,500 crore to settle arrears related to its interest rate equalization scheme, reported Mint.

This decision aims to alleviate the challenges small exporters face in view of rising interest rates and diminishing exports.

As per exporters the borrowing rate for MSMEs has already crossed the double-digit mark.

‘We ran out of money for the interest equalization scheme and asked for an additional Rs 2,500 crore from the finance ministry. The plan has received approval from finance, but the final call would be taken by the cabinet,” a government official told Mint seeking anonymity.

If the cabinet clears the additional requirement of Rs 2,500 crore for the scheme in FY23, this would make the total spending by the government touch Rs 4,876 crore.

This would be almost double the allocation made for the year.

The government allocated Rs 2,932 crore in FY24 for the interest equalization scheme, up by about a fourth of Rs 2,376 crore allocated in FY23.  (KNN Bureau)