Exporters seek priority sector lending from banks
Updated: Aug 01, 2013 03:07:44pm
New Delhi, Aug 1 (KNN) In order to bring exports under priority sector, exporter bodies have demanded quick implementation of the Reserve Bank of India's Padmanabhan Committee and lowering of interest rates.
Chairman of Apparel Export Promotion council (AEPC) A Sakthivel has written a letter to Finance Minister, P Chidambaram, seeking lower interest rates for exporters.
“Reserve Bank of India has announced the credit policy. However, the garment export industry was expecting lowering of the interest rate, which has not been announced. The pre and post shipment credit rates are hovering around 10 per cent which is very high when compared to interest rates available to our competitor,” AEPC chief said.
He said separate rates of fixed 7.5 per cent for the labour intensive sectors of clothing and textiles should be made available.
Sakthivel further said, the industry is looking up to the Finance Ministry for help for a stable and long term solution to high lending interest rates.
Similarly, the federation of Indian Exporters Organization (FIEO) has proposed the immediate implementation of Padmanabhan Committee recommendations for bringing exports under priority sector.
"What, perhaps, is required are immediate measures to be taken such as implementation of the Padmanabhan Committee recommendations (Set up by RBI ) which inter-alia are inclusion of exports in priority sector lending," said M Rafeeque Ahmed, President, Federation of Indian Export Organsiations (FIEO).
The committee has made recommendations relating to i) review of gold card scheme for extension of export credit to exporters, ii) appropriate inclusion of export finance under the priority sector advances for scheduled commercial banks, iii) raising of foreign currency loans on pool basis for extension of export credit to exporters, iv) allowing factoring on non-recourse basis, v) liberalization of merchanting trade, vi) financing to units in domestic tariff area (DTA) / Special Economic Zone (SEZ), vii) more incentives in the area of taxation benefits and subvention, viii) denomination of export credit limit in foreign currency, ix) simplification of hedging procedure, etc.
He also said, "Buyers credit to be made increasingly available, and the cap of USD 20 million for trade credit may be raised in deserving cases. (KNN/SD)
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Chairman of Apparel Export Promotion council (AEPC) A Sakthivel has written a letter to Finance Minister, P Chidambaram, seeking lower interest rates for exporters.
“Reserve Bank of India has announced the credit policy. However, the garment export industry was expecting lowering of the interest rate, which has not been announced. The pre and post shipment credit rates are hovering around 10 per cent which is very high when compared to interest rates available to our competitor,” AEPC chief said.
He said separate rates of fixed 7.5 per cent for the labour intensive sectors of clothing and textiles should be made available.
Sakthivel further said, the industry is looking up to the Finance Ministry for help for a stable and long term solution to high lending interest rates.
Similarly, the federation of Indian Exporters Organization (FIEO) has proposed the immediate implementation of Padmanabhan Committee recommendations for bringing exports under priority sector.
"What, perhaps, is required are immediate measures to be taken such as implementation of the Padmanabhan Committee recommendations (Set up by RBI ) which inter-alia are inclusion of exports in priority sector lending," said M Rafeeque Ahmed, President, Federation of Indian Export Organsiations (FIEO).
The committee has made recommendations relating to i) review of gold card scheme for extension of export credit to exporters, ii) appropriate inclusion of export finance under the priority sector advances for scheduled commercial banks, iii) raising of foreign currency loans on pool basis for extension of export credit to exporters, iv) allowing factoring on non-recourse basis, v) liberalization of merchanting trade, vi) financing to units in domestic tariff area (DTA) / Special Economic Zone (SEZ), vii) more incentives in the area of taxation benefits and subvention, viii) denomination of export credit limit in foreign currency, ix) simplification of hedging procedure, etc.
He also said, "Buyers credit to be made increasingly available, and the cap of USD 20 million for trade credit may be raised in deserving cases. (KNN/SD)
Feedback: newsdesk@knnindia.co.in
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