RBI sets up Technical Committee on Services/Facilities for the Exporters

Given the current global and Indian scenario and the importance of export sector in the overall context, the Reserve Bank of India has constituted a technical committee to examine issues relating to difficulties being faced by exporters with regard to availability of credit, transaction costs, insurance and factoring and other procedural hassles in their dealings with banks and financial institutions. The decision to set up such a committee was announced by the Governor, Dr. D.Subbarao in his meeting with bankers post Third Quarter Review of the Monetary Policy 2012-13 on January 29, 2013.

The Committee would be chaired by Executive Director, Shri. G. Padmanabhan with representation from EXIM Bank, ECGC, select banks, trade bodies, such as, Federation of Indian Export Organisation (FlEO), Indian Banks’ Association (IBA) and Foreign Exchange Dealers Association of India (FEDAI). Senior officers from DBOD, FED and DEPR from the Reserve Bank will also be represented on the Committee.

The terms of reference of the Technical Committee are:

• To review the existing policies/procedure relating to bank finance for exports and suggest measures to improve timely, adequate and hassle-free flow of credit towards working capital, capital expenditure and other requirements of the sector, and, in particular SME units;
• To evaluate and suggest ways for improving financial support to the export sector from alternative sources like factoring, interest subvention, export advance from the external sources, etc.;
• To assess the efficacy of the schemes/facilities of the export supporting bodies like the EXIM Bank, ECGC and suggest changes, if any, in such schemes/facilities;
• To examine and suggest measures to rationalise/reduce the transaction cost including bank charges and payment of other statutory fees, so as to improve transparency and certainty in the dealings of exporter clients with banks/other institutions;
• To suggest measures to simplify and rationalise the existing procedure including the documentation, etc., requirements for availing of various facilities and compliance with the requirements under FEMA;
• To examine specifically the special needs of exporting units located in SEZ, requirements of merchanting trade;
• To review the process of realisation/repatriation of export proceeds in a timely manner, including the use of new menthods of receipts like the online payment gateways;
• To suggest further measures for risk mitigation for the exporters including use of hedging instruments, smoothening the accounting issues, if any, relating to hedging, invoicing of exports in Indian Rupee;
• To specifically examine the existing capabilities and the emerging requirement of the system and the staff of the banks, financial /other connected institutions dealing with the export sector; and
• To examine any other related matter/issue for improvement of the services/facilities being extended to the exporters.

The Committee has been directed to submit its recommendations by end of April 2013.

The Committee invites view/comments/suggestions of all the stakeholders to reach the Committee on or before 28 February 2013. (Suggestion/ comments may be send by email).

R.R. Sinha
Deputy General Manager

Press Release: 2012-2013/1368