Thursday, June 20, 2024
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Govt allocates Rs 2,500 crore

The Union Cabinet, led by Prime Minister Narendra Modi, has sanctioned an additional Rs 2,500 crore for extending the Interest Equalisation Scheme on pre- and post-shipment rupee export credit until June 30, 2024. This move aims to facilitate competitive rates for rupee export credit, particularly benefiting exporters in identified sectors and all MSME manufacturer exporters amid global economic challenges.

Under the ‘Interest Equalisation Scheme for pre and post-shipment rupee export credit,’ the Union Cabinet’s decision involves allocating Rs 2,500 crore, supplementing the existing outlay of Rs 9,538 crore. This additional funding addresses the financial gap, ensuring the continuity of the scheme through June 2024. Exporters of specified products will receive a 2% subsidy, while all MSME exporters will benefit from a 3% subsidy.

The Interest Equalisation Scheme, initiated in 2015, initially valid for five years, has been extended multiple times, with fund allocations and individual exporter benefits now capped at Rs 10 crore per annum per IEC. The scheme, managed by RBI through various banks, aims to boost exports and increase liquidity for exporters, offering relief in challenging times, according to industry experts and officials from organizations like FIEO.

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