Five-year extension for interest equalisation scheme under consideration of Commerce Ministry

 This scheme supports exporters from identified sectors and MSME manufacturers in accessing export credit in rupees at competitive rates, which holds significance amid prevailing global challenges. It is of immense financial assistance to the exporters and FIEO has been harping upon the extension of this scheme to the exporters.

The government was proactive in dealing with this scheme; launched on April 1, 2015, the scheme was initially valid for 5 years until March 31, 2020, and has since been extended with additional funding.

Currently, the scheme offers an interest equalisation benefit of 2% on pre- and post-shipment rupee export credit to merchant and manufacturer exporters of 410 identified tariff lines, and 3% to all MSME manufacturer exporters.
These sectors encompass leather, carpets, handicrafts, fabrics, and readymade garments.Now operating as a fund-limited scheme, its benefits for individual exporters are capped at ₹10 crore annually per Import Export Code (IEC).

Banks charging exporters an average rate exceeding repo+4% are ineligible under the scheme.

Implemented by the Reserve Bank of India (RBI) through various banks providing pre- and post-shipment credit to exporters, the scheme is jointly monitored by the Directorate General of Foreign Trade (DGFT) and RBI.

No doubt, the exporters must be shown all encouragements possible since they are the major source of revenues to the nation. The more the exports, the more is the revenue; it is a common knowledge. And the Center is sensitive to the issues of the exporters.