Raising concerns over declining export credit, Commerce Minister Suresh Prabhu has suggested the Finance Minister Arun Jaitley to consider loans to exporters as priority sector lending by the banks. The minister also urged for strict timelines for grant of credit including the renewal of limits.
Prabhu cited RBI data which shows outstanding export credit fell by over 40% to Rs 22,300 crore on June 22 this year from Rs 39,000 crore as on June 23 last year. Besides, the data also shows that outstanding export credit fell by over 20% to Rs 28,300 crore as on March 30 as against Rs 22,300 crore as on June 22 this year.
Commerce Minister also underlined the impacts of declining export credit on exporters and MSME units in particular and requested Arun Jaitley to kindly have suitable instructions issued to banks to restore the flow of credit to the export sector to its expected regular levels, based on the required increase over recent peak levels, to factor in export growth currently taking place.