Partner Channels: Auctions | Auto | Bill Pay | IT Education | Jobs | Lifestyle | Technology | Travel
April 16, 2001
|
|
|
|
|
|
||
|
Channels: Astrology | Broadband | Contests | E-cards | Money | Movies | Romance | Search | Weather | Wedding | Women Partner Channels: Auctions | Auto | Bill Pay | IT Education | Jobs | Lifestyle | Technology | Travel |
||
|
|
||
|
Home >
Money > Business Headlines > Report April 16, 2001 |
Feedback
|
|
|
Interest rate on export finance may be restoredBS Banking Bureau The Reserve Bank is expected to restore the interest rate on export finance to its original level in the forthcoming credit policy. The central bank had increased the rate of export finance from 8 per cent to 10 per cent in July 2000 after repeated bouts of the rupee weakening. The eroding value of the rupee pushed the Reserve Bank of India into taking various measures to stop the free fall. Dealers feel that this credit policy will see the RBI restoring the limits on export finance. The Exim policy figures reflected that exports had indeed lessened but were still positive. "Though the figures are still positive, they have slowed down, indicating the global pattern and its effect in India. This may continue for a while but with the credit rate for export finance available brought lower, it may prove as an incentive," said a dealer with a foreign bank. As part of its rupee control measures, the central bank even rolled back some of the Exchange Earners' Foreign Currency schemes. In May and July 2000, in various packets of measures, the RBI decided to cut to half exporter's entitlement to retain their export earnings in EEFC accounts. The RBI also slapped an interest surcharge of 50 per cent on overdue import bills as part of the package to iron out leads and lags in the system. "With exports reducing globally and with the WTO-induced opening up of imports, there has to be restoration of the export finance and refinance limits in order to make it competitive for the exporters in India," said a dealer with a private sector bank. The end of 2000-01 saw the foreign exchange reserves at a good high of over $41 billion despite a year of over 6 per cent depreciation in the rupee and lots of liquidity tightening measures. With the dual effect of the WTO and globally declining exports, most market participants are expecting the finance rate to be restored in the upcoming credit policy. Powered by YOU MAY ALSO WANT TO READ:
|
||||
