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Exporters hope for raised interest benefit

The interest benefit under the Interest Equalisation Scheme should be raised to five per cent across the board. So says the Tirupur Exporters Association (TEA).

Raising the interest benefit under the Interest Equalisation Scheme would, it is felt, help protect the knitwear industry. Some export units in Tirupur have been finding it difficult to fulfill their export obligation for capital goods imported under the Export Promotion Capital Goods scheme and raw materials imported under the Advance Licensing Scheme within the stipulated period due to the impact of the pandemic, a rise in yarn prices and the Ukraine-Russia war.As the exporting units have to pay the interest apart from normal customs duty to regularise the case,

TEA says an amnesty scheme to settle export obligation defaults would be helpful. Since knitwear exporting units in the Tirupur cluster are now facing a severe threat to their existence due to issues like low orders, delay in receiving payment, non-acceptance of booked orders, and deferment of shipment, TEA has suggested that the Export Refinance Scheme be extended to banks to augment export credit, and banks may be encouraged to provide export credit in Indian rupee to exporters and the same amount can be refinanced by the Reserve Bank of India at the repo rate.

 
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