GJEPC Members May Approach Banks for Benefits For Export Credit

Member-exporters are advised to approach their banks directly to seek benefits following changes in provisions related to packing credit and extension of repayment time introduced by the RBI

The Gem & Jewellery Export Promotion Council (GJEPC) has advised all its memberexporters to approach their banks directly and seek benefits arising from certain changes in provisions related to packing credit and extension of time for repayment that have been recently introduced by the RBI. These changes in the Master Direction – Export of Goods & Services 2016, issued by RBI, have been announced by the central bank in the context of disruptions to business due to the current Covid-19 pandemic.

It may be recalled that the GJEPC had last month requested the government for certain relaxations in time limits for repayment of export credit due to then anticipated delays in realisation of export proceeds. At that time the impact of Covid-19 was mainly limited to Hong Kong and China, which account for about onethird of India’s exports. Since then, the virus is reported to have spread to more than 100 countries across the globe.

GJEPC said that after it had further discussions with the Ministry of Commerce & Industry (MoC&I) and Ministry of Finance (MoF) about the impact on the trade, the government has introduced some changes in terms of Packing Credit and Extension of Time for realisation of export proceeds for delays arising due to the impact of Covid-19 on the business.

Some key highlights include seeking permissions for delays in shipment under packing credit; granting of period of nine months from the date of export for realization and repatriation of export proceeds for exports from SEZs, EOUs, Status Holder Exporters and certain others; and of 15 months from the date of shipment of goods in the case of goods exported to a warehouse established outside India.

Additionally, AD Category-I banks have been permitted to extend the period of realization of export proceeds beyond the stipulated period of realization from the date of export, up to a period of six months, under certain conditions as stipulated by RBI. The Council has stressed that all reporting of exports should be done under the EDPMS and has asked trade members-exporters to make use of above provisions and approach the banks directly so as to streamline business activity in the current situation.

Banks can extend the period of realization of export proceeds up to six months from the date of export, subject to certain RBI stipulations.’

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