Government decision to release pending export incentives will help ease liquidity

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Government decision to release pending export incentives will help ease liquidity


Exporters say the government’s decision to release the pending export incentives dues worth Rs. 56027 Cr will help the exporters in increasing competitiveness and will lead to rise in liquidity. It was a good decision at the right time to solve the liquidity crunch among exporter at current challenging times. The Vice President of Federation of Indian Export Organisations (FIEO) the apex body for exporters in India Mr. Khalid Khan said that it was a much anticipated move as exporters are facing liquidity issues and urged the government to implement the decision on time to provide much needed support to exporters.

Even the Former Chairman of FIEO Mr. S K Saraf appreciated the move and said that delays in payments of incentives has caused cash flow problem for exporters in MSME sector in India. He also said that this payment will be a great relief to exporters in these challenging times, He hoped that government makes the payment fast which will save a lot of MSME from certain extinction.

The Chairman of Plastics Export Promotion Council of India (Plexconcil) Mr. Arvind Goenka says that the release of MEIS  incentives of the past 2 years will be a great help and support to exporters It is expected that more than Rs 2,000 crore will be distributed to plastic processors, Mr Goenka said, expressing hope that FIBC (flexible intermediate bulk container) bags too would be covered under the announcement as its exports are on a downward fall since MEIS was removed.

On 9 September 2021, the government announced that it will release INR 56,027 Cr to exporters against pending tax refunds under various different incentive/schemes for shipments abroad. The amount will be distributed among 45000+ exporters. The Chairman of Total Group Mr. Vijay Gupta says that the this decision will boost the morale of exporters who are currently suffering because of  excessively high sea freight.  Similar views were expressed by Mr. Colin shah , the Chairman of Gems and Jewellery Export Promotion Council (GJEPC)  He said that this will be a huge relief to exporters who were unable to price competitively with neighboring countries and were challenged with their working capital and cash flows problems. He further added that "This will be a good positive signal to exporters and will motivate them to focus on building and growing their export business”.

Mr. Sanjay Leekha Chairman of Council for Leather Exports (CLE) says this decision was a request of all the members and has come as a great support to the leather and footwear export sector which is facing a huge cash flow problem to finance its day-to-day manufacturing operations and exports productions. He also stated that "This will help in easing out the liquidity crunch to exporters and will further boost the export growth to meet the demand of the international market," and will also help in achieving the nations export target of USD 400 billion for this fiscal year.

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