Re-introduce Interest Subvention On Exports: FIEO

The Federation of Indian Exports Organisation (FIEO), the apex body of exporters, is disappointed with the exports registered in the month of October. The association noted that sectors, which were expected to perform better in exports, recorded a negative or a meager growth last month.

“Surprisingly, all our performing sectors, which were expected to bring a turnaround either exhibited negative or miniscule growth. While engineering, drugs and pharmaceuticals, gems and jewellery, cotton and man-made yarn, carpets entered into the negative territory joining petroleum and plantation sectors, growth has moderated in leather, apparels and marine sector. This is an alarming situation,” said M Rafeeque Ahmed, president of FIEO.

He attributed the dismal performance of the export community to the dismissal of interest subvention on exports. “The Government should immediately re-introduce interest subvention on exports from April 2014 as banks have not only stopped passing interest subsidy to exporter specially MSME exporters thereby raising cost by 3% but also started recovering the same in absence of any communication from RBI or the Government,” added Ahmed.

He also explained that the exporters wanted more clarity regarding the new foreign trade policy (FTP) as they were facing problems while computing the costs at the time of new orders. The association has also suggested that the government should extend the present FTP of the previous government till the end of the current fiscal year.

“The new Foreign Trade Policy should focus on marketing, branding, e-commerce, services exports, project exports, high technology exports. Far reaching changes in procedures are also needed to address high cost of doing business in India. Simplification, self -attestation, EDI connectivity, risk management system should be the main plank for reducing transaction time and cost,” stated Ahmed.