Welcoming the RBI’s decision to extend the Interested Equalization Scheme on export credit by one year till March 31, 2021, the Apparel Export Promotion Council (AEPC) said it will enable access to cheaper loans.
“We welcome the RBI’s announcement in this hour of crisis. It will help the Apparel exporters gain access to cheaper loans,” AEPC Chairman A Sakthivel said after the RBI extended the Interest Equalization Scheme on Pre and Post Shipment Rupee Export Credit by one year.
The RBI notification was issued on Wednesday evening.
“With the current uncertainty of rupees exchange rate vis-à-vis other currencies, taking rupee loan on packing credit lowers down our interest burden and removes the need for taking a risk on foreign cover,” Sakthivel said.
He said AEPC has been demanding extension of the scheme to sail through the Covid-19 pandemic.
In November 2018, the interest subsidy was increased to 5 per cent from 3 per cent with an aim to boost MSME sector exports.
Later, the government included other merchant exporters too under the scheme and allowed them interest equalisation at the rate of 3 per cent on credit for export of certain products.
“We wholeheartedly thank our Minister of Textiles, Minister of Commerce and Industry and Minister of Finance and specially the RBI Governor. This will help us a lot during this crisis,” Sakthivel added.