Amid credit squeeze, exporters may soon get loans at low rates

Export credit disbursement declined 23% to  ₹9.57 trillion from  ₹12.4 trillion a year ago. (Mint file)

NEW DELHI : The Union government will finalize norms soon to provide easier loans including foreign exchange credit to exporters at interest rates below 4%, commerce minister Piyush Goyal said Thursday, in the backdrop of a squeeze in credit availability for them.

“We are very concerned that export credit has fallen. We will come up with the contours of a vibrant programme to address the issue soon, which will particularly support micro, small and medium enterprises,” commerce minister Goyal said, while addressing the meeting of the board of trade.

Export credit disbursement declined 23% to 9.57 trillion from 12.4 trillion a year ago.

Goyal said the Export Credit Guarantee Corp. of India may also come out with a credit scheme with enhanced insurance cover up to 90% instead of 60% at present, providing comfort for banks.

According to official trade data, India’s merchandise exports declined 0.37% to $107.41 billion during April-July, while merchandise imports fell 3.6% to $166.8 billion during the same period.

Although total exports of India crossed half trillion-dollar mark at $537 billion in 2018-19, with goods exports at an all-time high of $331 billion and services exports at $205 billion, Goyal said India will have to achieve $1 trillion of exports in the next five years. “For this, we need to increase domestic production and improve our competitiveness,” he added.

Releasing the LEADS Index-2019, Goyal announced that Gujarat topped the chart among states in the logistics sector followed by Punjab and Andhra Pradesh.

The LEADS Index is an effort by the commerce and industry ministry to establish the base line of performance in the logistics sector based on the perception of users and stakeholders at the state level.

It provides the basis for stakeholder engagement, discussions and evolving action plan by various agencies. It is not an index of the performance of the state government but may be used to assess the status of logistics efficiency in each state.

The state logistics performance index is arrived at using a ranking methodology based on a series of meetings with stakeholders and online surveys in the key areas of the logistics like infrastructure, services, timelines, traceability, competitiveness, security, operating environment and efficiency of regulation.