New Delhi: Major export organisations along with industry associations have sought several relaxations to minimise the adverse impact of the 50% tariff imposed by the US on Indian exports.

Representatives of the organisations met Reserve Bank of India (RBI) Governor Sanjay Malhotra on Thursday (September 11) furthering their demands.

The demands of the various groups include a one-year moratorium on loan repayments, a collateral-free credit scheme, relaxation of non-performing asset (NPA) norms along with extensions on due dates without penalties, reported Business Standard.

A major demand raised in the two-hour meeting in Mumbai was that instead of the normal exchange rate by converting the US dollar into rupees, the RBI permits settlement of exports at the real effective exchange rate (REER).

The delegations also urged the central bank to allow the domestic currency depreciate freely so that exporters could square off some of the losses they will incur due to the tariffs imposed by the Trump administration.

“The demand from exporters is twofold: addressing the 50 per cent tariffs and critical banking issues of exporters,” said Ajai Sahai, director general and chief executive officer, Federation of Indian Export Organisation, reported Business Standard.

The exporters also called for additional support from Indian banks through increased lending to the sector by creating a sub-category under priority sector lending (PSL) norms.

Even though exports are part of PSL, the delegation said that bank funding to the sector remains muted, flagging concerns over the high cost of credit, unfair trade practices by rating agencies, and classification norms for MSMEs in relation to NPAs.

Sahai said that while exports account for over 20% of India’s GDP, credit to exporters remains subdued, and greater support from banks is needed.

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