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Make credit available to exporters at base rate - FIEO
08 Jul '10
1 min read
Looking at the southward movement in the interest rate overseas, Mr A. Sakthivel, President, Federation of Indian Export Organisations (FIEO) has proposed for availability of the credit to the export sector at the base rate itself.
Substantiating his demand, FIEO Chief said that export credit to our competitors are available at less than 5%, while base rate ofmost of the banks ranges between 7.75% to 8.25%. If the export credit is capped at the base rate by the Government, pleaded Mr Sakthivel, exporters would be able to get the credit at about 8% on average basis. Such high interest rate will definitely make export less competitive but will at-least ensure that exports continues to get the credit close to the rate at which the credit was available prior to the base rate regime from 1st July, 2010.
Looking at the continuous decline in exports of Garments and loss of market share in US and EU, President FIEO has also taken up the issue of extension of interest subvention of 2% for Apparel sector.
FIEO has already moved to the Ministry of Finance and Commerce Ministry requesting for earliest capping of export credit and extension of subvention benefits to Garments.
Substantiating his demand, FIEO Chief said that export credit to our competitors are available at less than 5%, while base rate ofmost of the banks ranges between 7.75% to 8.25%. If the export credit is capped at the base rate by the Government, pleaded Mr Sakthivel, exporters would be able to get the credit at about 8% on average basis. Such high interest rate will definitely make export less competitive but will at-least ensure that exports continues to get the credit close to the rate at which the credit was available prior to the base rate regime from 1st July, 2010.
Looking at the continuous decline in exports of Garments and loss of market share in US and EU, President FIEO has also taken up the issue of extension of interest subvention of 2% for Apparel sector.
FIEO has already moved to the Ministry of Finance and Commerce Ministry requesting for earliest capping of export credit and extension of subvention benefits to Garments.
Federation of Indian Export Organisations (FIEO)
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