Exporters seek removal of cap on interest subvention

Mumbai: Exporters on Friday urged the government to remove the cap on interest subvention, saying the current level of support is inadequate to cushion the sector amid rising global trade uncertainties.

The Federation of Indian Export Organisations (FIEO) expects the government to revisit the structure of the subsidy scheme to provide more meaningful relief to businesses facing higher borrowing costs and volatile export demand, a top official added.

“We are expecting the government to remove the cap that they have put on the interest subvention. The government is providing a small 75 per cent interest subvention with a cap of 50 per cent which is grossly inadequate,” said Ajay Sahai, Director General and CEO, FIEO. Last month, the government amended guidelines for interest subvention support for pre- and post-shipment export credit under Rs 25,060 crore export promotion mission.