Government Extends Interest Equalisation Scheme Until December to Boost Exports

The Indian government has extended the Interest Equalisation Scheme for pre- and post-shipment rupee export credit until December 31, 2024. The scheme, which aids exporters with interest benefits, is aimed at promoting outbound shipments amid global economic challenges. Fiscal benefits for MSME exporters are capped at Rs 50 lakh for the extension period.

The Indian government has announced an extension of the Interest Equalisation Scheme for pre- and post-shipment rupee export credit until December 31, 2024. The scheme, which provides crucial interest benefits to exporters, is designed to boost the nation's outbound shipments, especially amidst prevailing global economic headwinds.

Originally set to expire on September 30, the scheme's continuation was confirmed by the Directorate General of Foreign Trade (DGFT) and includes significant fiscal restrictions for MSMEs. Exporters from the MSME sector will have their benefits capped at Rs 50 lakh for the fiscal year 2024-25, applicable until December 2024. Those who have already availed benefits up to Rs 50 lakh by September 30 will not be eligible for further assistance during the extension.

The extension follows the Union Cabinet's approval of an additional Rs 2,500 crore funding, adding to the existing Rs 9,538 crore outlay. Despite facing a decline in exports and a growing trade deficit, the scheme continues to support exporters in mitigating financial burdens. Director General of the Federation of Indian Export Organisations (FIEO), Ajay Sahai, emphasized the need for a long-term extension to better support MSMEs during these challenging times.

(With inputs from agencies.)