FIEO Urges Revival of Interest Subsidy Amid US Tariff Hike

The Federation of Indian Export Organisations (FIEO) is requesting the government to reinstate a 5 per cent interest subsidy to mitigate the impact of increased US tariffs on Indian exports. The tariff hike, effective April 9, will escalate costs for American importers, potentially causing payment delays to Indian exporters.

The Federation of Indian Export Organisations (FIEO) has called on the government to reinstate a 5 per cent interest subsidy scheme in light of new US tariffs. The 26 per cent tariffs, effective from April 9, are expected to significantly raise costs for American importers, likely resulting in deferred payments to Indian exporters.

The FIEO emphasized the urgent need for a government response to mitigate an impending liquidity crunch due to the additional burden on US importers. As of now, Indian exporters face interest rates between 8 to 12 per cent, in contrast to much lower rates in competitor countries.

FIEO President SC Ralhan highlighted the challenges of sharing the tariff burden with US buyers, who are demanding discounts. The suspended subsidy scheme benefitted 11,000 exporters and needs reviving under the Export Promotion Mission, with a proposed allocation of Rs 2,250 crore.