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Apparel industry players have sought the continuation of the interest subvention on pre-shipment export credit till the end of the next fiscal. Apparel Export Promotion Council (AEPC) has asked the Commerce Ministry to take up the matter with the Finance Ministry for the extension of 2 per cent interest subvention up to March 2012.
Mr Premal Udani, Chairman, AEPC said, “The issue has been very sensitive for the growth of garment sector… As we understand that the said subvention is up to March 31, 2011 only, we want the scheme to be extended for the period 2011-12 and the benefit be given across apparel export industry.”
In the last Union Budget, the Government had provided interest subvention of 2 per cent on pre-shipment export credit up to March 31, 2010 for exports in certain sectors.
But the sector-specific subvention available to garments had been discontinued, AEPC officials said. It was further specified that apparel manufacturers falling under the SME (small and medium enterprises) category only could avail of the said subvention.
According to the RBI Notification (RBI/2010-11/165), the benefit had been restricted to four items only, leaving out many major categories. “All this had largely restricted garment exports,” AEPC said.
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