(MENAFN- KNN India)
New Delhi, Feb 3 (KNN) The Indian exporting community has called on Finance Minister Nirmala Sitharaman to reinstate the Interest Equalisation Scheme (IES), which ended on December 31, 2024.
Despite significant measures announced in the Union Budget to support exports, exporters expressed concern over the omission of the IES, which has been crucial in providing affordable credit.
Sanjay Budhia, Chairman of the CII National Committee on EXIM, emphasised the scheme's importance, stating, "The Budget announcements are promising for exports, but we sincerely urge the Finance Minister to reinstate the scheme for all exporters to keep them globally competitive."
Under the scheme, exporters received subsidies on pre- and post-shipment rupee export credit, enabling them to access funds at competitive rates.
With the global economy facing headwinds, affordable credit remains critical for sustaining and expanding Indian exports.
Federation of Indian Export Organisations (FIEO) President Ashwani Kumar pointed out that the commerce ministry had allocated Rs 2,250 crore under export promotion schemes, covering both IES and the Market Access Initiative (MAI).
He urged the government to extend IES from January 1, with a cap of Rs 10 crore, and to approve international events under MAI for 2025-26 immediately.
The government had originally launched the IES on April 1, 2015, with an initial five-year tenure, extending it multiple times, including a one-year extension during the COVID-19 pandemic.
The scheme provided a 2 per cent interest equalisation benefit on export credit for various product categories and a 3 per cent benefit for MSME manufacturers.
It covered sectors such as handicrafts, leather, fabrics, carpets, and garments, with implementation facilitated by the RBI and public and private sector banks.
Industry leaders acknowledged that certain Budget measures, such as reduced customs duties on key inputs, the rollout of a national manufacturing mission, and the establishment of an export promotion mission, would boost exports.
However, they stressed that without affordable credit, small and medium exporters could struggle to compete internationally.
Apparel Export Promotion Council (AEPC) Chairman Sudhir Sekhri highlighted that support for MSMEs, skilling programs, and regulatory reforms would help exporters.
AEPC Secretary General Mithileshwar Thakur added that initiatives like BharatTradeNet, aimed at streamlining export documentation, could further enhance the sector's growth.
Exporters now await the government's response, hoping for an extension of the IES to sustain India's export momentum in a challenging global landscape.
(KNN Bureau)
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