FIEO seeks extension of export credit period to 450 days after RBI rate hike
New Delhi, Oct 7 (TNT): The Federation of Indian Export Organisations (FIEO) on Wednesday urged the Reserve Bank of India (RBI to extend the pre-shipment and post-shipment export credit period from 270 days to 450 days following the RBI’s 25-basis-point increase in the repo rate to 5.50 per cent.
In a release, FIEO President S C Ralhan said the rate hike and calibrated tightening stance were understandable in view of emerging inflationary pressures, but cautioned that higher borrowing costs could increase the financial burden on exporters, particularly MSMEs.
He said exporters were facing an uncertain global environment marked by geopolitical tensions, volatile energy prices, supply-chain disruptions, longer transit periods and delays in payment realisation, which were extending the export working-capital cycle.
Ralhan said extending the export credit period to 450 days would provide exporters greater flexibility to manage longer shipping and transit periods and delayed realisation of export proceeds.
FIEO also sought targeted liquidity support and adequate availability of affordable export credit to help exporters absorb higher input and financing costs, maintain production and fulfil overseas orders.
The organisation noted that the RBI had projected real GDP growth at 7.1 per cent for 2026-27 and CPI inflation at 5.2 per cent, while flagging continuing global headwinds arising from geopolitical tensions, energy-price volatility and tighter global financial conditions.
Ralhan said India’s resilient growth, bilateral trade agreements, strong services exports and recovery in merchandise exports could support expansion of the country’s global trade footprint.
However, he stressed that maintaining export competitiveness would require continued access to affordable finance and appropriate policy support, particularly for MSMEs.
TNT KS
