Declining bank credit to hurt export; traders to flag issue to Goyal

The declining bank credit to exporters will hurt the sector, and traders will flag the issue prominently during their meeting with Commerce and Industry Minister Piyush Goyal on September 11, an industry official said on Sunday.

While exports grew by 15 per cent in the rupee terms between 2021-22 and 2023-24, the outstanding credit in March 2024 dropped by 5 per cent over the same month in 2022, according to exporters.

Apex exporters body Federation of Indian Export Organisation (FIEO) said the export credit growth is not keeping pace with rising exports of the country.

"We have seen a decline in export credit between March 2022 and March 2024 despite the need for more credit for longer duration due to hike in prices of commodities, sharp spurt in freight (both sea and air) and the Red Sea crisis, leading to longer voyage time and delayed payment," FIEO Director General Ajay Sahai told PTI.

According to FIEO, the value of export credit outstanding has come down to Rs 2,17,406 crore