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Nothing seems right for exporters, MSMEs
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Bikky Khosla | 26 Oct, 2010
Wary of a volatile rupee and awaiting a rise in demand in key markets during the Christmas season, exporters, especially those from the MSME sector, are now urging the RBI to ensure that 50 percent of the total export credit is earmarked to the Micro, Small and Medium Enterprise (MSME) sector.
With the sector facing constant decline in export credit, perhaps it's time RBI gives clear direction to the banks that exporters should be provided priority in allocation of foreign currency denominated credit.
With banks free to charge interest rates above the base rate, they are surprisingly charging export credit 150 to 200 basis points above the base rate which makes the export credit rate under the Base Rate Regime more costly than in the PLR regime. I think the apex bank should also instruct banks to provide export credit at the base rate itself, at least for now.
And that's not all. The under valuation of the Yuan meanwhile stands to adversely impact Indian exports at a time when China's non-tariff barriers are already posing a major hindrance to the country's exports, especially in the sectors of services, IT, agriculture and pharmaceuticals. China has hardly done much to ensure appreciation of the Yuan and if the international community doesn't give enough pressure, I see tough days ahead for our export community.
However, the bad news for the week do not end here. The MSME ministry has now proposed to do away with the plan to make it mandatory for PSUs and the government departments to procure 20 percent of their total requirements from these units.
What amazes me is the fact that this new proposal to dilute its earlier proposal is in complete contrast to the recommendations of the task force set up by the Prime Minister for the sector. So much for the decisions taken by our authorities!
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We should Look the Brighter Side of Things Always
Anupma Sancha | Sun Nov 7 05:49:09 2010
The President Mr.Obama Visit may bring someone new openings in the recent stagnant economy both ways.2011 will be a year of new projects and collabrations,hope for the best.
Indian Business Scenario
N.K.Tawakley | Thu Oct 28 09:19:29 2010
The reality is that the Government and Bureaucracy has become totally insensitive to the issues faced by the industry. They have totally lost touch with the world. Where the world is and where India stands as of today. Our PM is being constantly fooled by the bureaucracy that India is growing at a high growth rate.
But if there is growth, why is it not visible.Where is all the money going.
The stock market is now totally dependent on the Foreign Investments. The dollar rate is totally controlled by the foreign investments.
Both indicate how weak our economy has become. But every body in the G & B is happy because their salaries are growing faster than anywhere else in the world.
India is at the same condition as at the time of independence. All the raw materials are being exported and all finished goods are now being imported. Nobody is worried.India is bleeding.
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| Customs Exchange Rates |
| Currency |
Import |
Export |
US Dollar
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84.35
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82.60 |
UK Pound
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106.35
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102.90 |
Euro
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92.50
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89.35 |
| Japanese
Yen |
55.05 |
53.40 |
| As on 12 Oct, 2024 |
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| Daily Poll |
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| Will the new MSME credit assessment model simplify financing? |
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