Trade Finance Concerns for Exporters: Commerce Ministry Meets Officials
Oct 14, 2024 21:56
India's Commerce Secretary met with officials and exporters to discuss trade finance issues, including declining credit and its impact on exports. The meeting addressed the need for low credit rates, enhanced insurance coverage, and priority lending.
Illustration: Uttam Ghosh/Rediff.com
New Delhi, Oct 14 (PTI) Commerce Secretary Sunil Barthwal on Monday held a meeting with officials from several government departments as well as representatives of export promotion councils to discuss trade finance related issues of exporters, an official said.
The issues which figured in the meeting included the need for low rate of credit, enhanced insurance coverage, coverage of loans, and priority lending, the official said.
The meeting comes at a time when exporters flag concerns over declining bank credit and its impact on exports.
While exports grew by 15 per cent in the rupee terms between 2021-22 and 2023-24, the outstanding credit in March 2024 dropped by 5 per cent over the same month in 2022, according to exporters.
Apex exporters' body the Federation of Indian Export Organisation (FIEO) said the export credit growth is not keeping pace with rising exports of the country.
According to FIEO, the value of export credit outstanding has come down to Rs 2,17,406 crore in the March 2024 quarter from Rs 2,27,452 crore in the same quarter last year.
According to the official, a presentation was made on trade finance and an agenda was set up, which will be taken forward for further discussions.
The Monday's meeting, chaired by Barthwal, was attended by officials of the finance ministry, the RBI and representatives of export promotion councils.
An industry official said that ways to increase flow of finance was deliberated upon in the meeting.
India's exports registered a steepest decline in 13 months, falling 9.3 per cent to USD 34.71 billion in August due to global economic uncertainties, while the trade deficit soared to a 10-month high of USD 29.65 billion.
Exports during April-August this fiscal increased marginally by 1.14 per cent to USD 178.68 billion, while imports grew 7 per cent to USD 295.32 billion.
Merchandise trade deficit during April-August 2024 stood at USD 116.64 billion compared to USD 99.16 billion during the year-ago period.
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