FIEO Calls for Five-Year Extension of Interest Subvention Scheme To Boost Exports

The apex exporters body FIEO has urged the government to extend the interest subvention scheme for five years to boost credit flow in the export sector. This comes as the country's shipments saw a 9.3% decline in August. The scheme, aiding MSME manufacturers, is set to expire on September 30.

The apex exporters body FIEO has urged the government to extend the interest subvention scheme for five more years to stimulate credit flow in the export sector. This request follows a significant 9.3% fall in the country's shipments in August.

Currently, the scheme, which provides interest benefits on pre- and post-shipment rupee export credit, is set to expire on September 30. FIEO's Director-General Ajay Sahai emphasized the importance of the scheme, warning that its discontinuation could result in the loss of markets and orders.

The scheme, introduced in April 2015, aids exporters, especially from MSME sectors, by offering competitive credit rates. Despite several extensions, the scheme remains a crucial source of funding, capped at Rs 10 crore per annum per exporter. FIEO President Ashwani Kumar highlighted that over 50% of India's production is from MSMEs, which currently face financing challenges.

(With inputs from agencies.)