India Likely To Restore Interest Subsidy For Exporters.

The Indian government may restore interest subsidy for exporters enabling them to complete in the global market, after the government decided to end the tax-refund DEPB scheme effective October 1, reports said.

According to sources, the small exporters may get subsidy between 3.50 percent and 3.75 percent, while large corporates may get two percent subvention, adding that a decision in this regard might be announced soon.

The interest subvention scheme, which lapsed on March 31, had offered two percent discount on the interest rate charged by banks.

Exporters have been putting pressure on the government that they should be given access to finance at a subsidized interest rates since they are to compete with China, where borrowing cost is quite less.

Besides, under the alternative scheme to the Duty Entitlement Pass Book (DEPB) the stimulus which was given in the form of sops to the extent of 2-3 percent has also been withdrawn.

Exporters' body Federation of Indian Export Organizations (FIEO) said the robust growth in exports witnessed between April-August period might not be sustained in the third and fourth quarter of the current fiscal.

"Exports growth may not maintain the tempo due to rising credit and input cost. Exports may grow merely 10-12 percent in the second half of the current fiscal," FIEO President Ramu Deora said.

During April-August this fiscal, exports rose by 54.2 percent to $134.5 billion.

FIEO said exporters are also under pressure to maintain their competitiveness overseas and double their exports to $450 billion by 2013-14.

Source : rttnews.com