The Government of India has raised the rate of interest subvention for credit obtained by exporters from the present 2 percent to 3 percent, in view of persistent demand to both increase the rate of subvention and also to widen the coverage.
At present, all exporters who are micro and small enterprises, irrespective of the export sector, are beneficiaries of this scheme.
“In addition, the exporters belonging to the following sectors are eligible to receive interest subvention: (i) Handlooms (ii) Handicraft (iii) Carpets (iv) Toys and Sports Goods (v) Processed Agricultural Products (vi) Readymade Garments (vii) 235 tariff lines in Engineering Sectors, and (viii) 6 tariff lines in Chapter 63 of ITC(HS) (textiles made ups),” said a press release from the Ministry of Commerce & Industry.
The increase in subvention rate will benefit the exporters of small and medium enterprises and also the most of the labour intensive sectors, like textiles. Their cost will come down appropriately by increase in the rate of interest subvention.
The Commerce and Industry Minister has convened a meeting of Board of Trade (BoT) on 27th August, 2013 to review the current situation and the international trade scenario, the release said.
The Apparel Export Promotion Council (AEPC) said the increase in interest subvention will help all SME exporters as the availability of capital at low interest is critical component.
The Indian Government is concerned due to falling exports, and the volatility in rupee against dollar, and hence, the increase in interest subvention has come at an appropriate time, the association said in a statement.
The Government’s move would help in addressing India’s growing current account deficit, and would also improve the liquidity condition and help in the boosting the apparel exports from India, AEPC chairman A Sakthivel said.
Source:
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