Latest News | Exporters Seek Govt Intervention in Providing Affordable Credit to MSMEs, Seek ECLGS Extension

New Delhi, Oct 2 (PTI) Exporters have sought the central government's intervention in providing affordable and easy availability of credit to MSMEs amid global headwinds due to lack of liquidity.

In a letter to Finance Minister Nirmala Sitharaman, apex exporters' body Federation of Indian Export Organisations (FIEO) requested for the extension of Emergency Credit Linked Guarantee Scheme (ECLGS) till March 31, 2024 and restoration of interest subsidy benefit of 5 per cent to manufacturer MSMEs.

Also Read | Lal Bahadur Shastri Birth Anniversary 2023: Interesting Facts About Former Prime Minister of India Who Gave ‘Jai Jawan, Jai Kisan’ Slogan.

It said some of the MSME sectors are affected due to a dip in exports on account of a global demand slowdown.

FIEO has urged extending the ECLGS "till March 31, 2024" as it will help micro, small and medium enterprises sail through this difficult time and bounce back when the situation improves.

Also Read | Gandhi Jayanti 2023: Interesting Facts About ‘Father of Nation’ Mahatma Gandhi on His 154th Birth Anniversary.

"With interest rates firming up, MSMEs are getting credit at not less than 8-11 per cent. The subvention for the interest equalisation scheme was reduced as interest rates were coming down. However with complete change in situation, there is an urgent need to restore interest equalisation benefit of 5 per cent," it added.

MSMEs account for about 40 per cent in the country's total exports.

India's exports declined 6.86 per cent to USD 34.48 billion in August, for the seventh month in a row, due to a fall in shipments from key sectors like petroleum and gems and jewellery on subdued global demand.

The trade deficit (difference between imports and exports) during the month touched a 10-month high of USD 24.16 billion.

Cumulatively, exports during April-August this fiscal contracted 11.9 per cent to USD 172.95 billion. India's exports contracted 15.88 per cent in July.

Exports sectors, which recorded negative growth in August, include tea, coffee, rice, spices, leather, gems and jewellery, textiles, and petroleum products.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)