Revitalise priority sector export credit to sustain export growth: FIEO
Federation of Indian Export Organisations (FIEO) has said that India's exports continue to hold up well in a volatile global market, though institutional credit support remains inadequate, adding that priority sector lending (PSL) for export credit has witnessed a significant decline, with export credit contracting by nearly 14% in the recent period. This has created serious liquidity constraints, particularly for MSME exporters who constitute the backbone of India's export sector.
Therefore, the industry body urged the government to engage with the Reserve Bank of India and the banking sector to restore export credit as a strategic priority, ensure adequate and timely availability of export finance at internationally competitive interest rates and encourage banks to adopt a more facilitative approach towards exporters. It said a vibrant and responsive export credit ecosystem will be indispensable for achieving India's ambitious target of becoming a $2 trillion export economy.
Apart from this, FIEO requested the government to address the logistics challenges impacting India's export competitiveness and establish an Apex Green Transition Fund dedicated to supporting exporters in adopting cleaner technologies, improving energy efficiency and reducing carbon intensity. Besides, the industry body urged the government to operationalise GST refunds for foreign tourists to promote tourism and retail exports.
