What changed
The Government of India widened the interest subvention scheme to include exports of ITC (HS) textiles goods covering 6 tariff lines and additional 101 tariff lines in engineering goods sector (beyond the existing 134 lines) for the period April 1, 2013 to March 31, 2014. All other terms and conditions from the January 22, 2013 circular remain unchanged.
What it means for you
Scheduled Primary (Urban) Co-operative Banks holding AD Category I licence can now offer 2% interest subvention on pre- and post-shipment rupee export credit to a broader set of export sectors. This expands the eligible borrower base, potentially increasing export lending volumes. Banks must ensure correct classification of tariff lines as per the annexed lists to claim subvention.
What you must do
- Update internal systems to include the new 6 textile tariff lines and 101 additional engineering tariff lines for interest subvention claims.
- Train loan officers to verify export invoices against the updated ITC (HS) codes from Annex I and Annex II.
- Ensure compliance with all existing terms from circular dated January 22, 2013, including documentation and reporting.
- Communicate the expanded scheme to eligible export customers to encourage uptake.
Who it affects
Scheduled Primary (Urban) Co-operative Banks holding AD Category I licence, Exporters in textiles (6 tariff lines) and engineering goods (101 new tariff lines), Existing export credit borrowers in the newly added sectors
Which sectors are newly covered under the interest subvention scheme?
Textiles goods under 6 specific tariff lines (e.g., blankets, bed linen, curtains, sacks, tarpaulins, and other made-up articles) and engineering goods under 101 additional tariff lines (e.g., stainless steel products, aluminium articles, base metal fittings, locks, and safes) for the period April 1, 2013 to March 31, 2014.
Does this circular change any other terms of the subvention scheme?
No. All other terms and conditions from the earlier circular dated January 22, 2013 remain unchanged. Only the list of eligible sectors has been expanded.
What is the effective period for the expanded subvention?
The expanded coverage applies from April 1, 2013 to March 31, 2014, as per the Government of India's decision.