| INTEREST RATE CEILING ON RUPEE EXPORT CREDIT |
On September 24, 2001, it was decided to effect reduction in the ceiling of interest rates charged by scheduled commercial banks on pre-shipment and post-shipment rupee export credit by one percentage point (linked to BPLR) with effect from September 26, 2001. This dispensation was earlier extended up to October 31, 2005.
Subject to the review of the BPLR system afresh, as indicated in the Mid-term Review of the Annual Policy Statement for the year 2005-06, it has been decided to extend the validity of the reduction in the interest rates (linked to BPLR) on pre-shipment rupee export credit up to 180 days and post-shipment rupee export credit up to 90 days announced on September 24, 2001 for a further period of six months up to April 30, 2006.
Categories of export credit |
Interest Rates@ (Per cent per annum) |
| Effective from November 1, 2005 to April 30, 2006 | |
| 1. Pre-Shipment Credit | |
| (a) (i)Upto 180 days | Not exceeding BPLR minus 2.5 percentage points |
| (ii) Beyond 180 days and upto 270 days | Free* |
| (b)Against incentives receivable from Government covered by ECGC guarantee upto 90 days | Not exceeding BPLR minus 2.5 percentage points |
| 2. Post-Shipment Credit | |
| (a)On demand bills for transit period (as specified by FEDAI) | Not exceeding BPLR minus 2.5 percentage points |
| (b)Usance
Bills (for total period comprising usance period of export bills, transit period as
specified by FEDAI and grace period wherever applicable) (i) Upto 90 days (ii)Beyond 90 days and upto 6 months from the date of shipment (iii)Upto 365 days for exporters under the Gold Card Scheme |
Not exceeding BPLR minus 2.5 percentage points Free*
|
| (c) Against incentives receivable from Government( covered by ECGC guarantee) upto 90 days | Not exceeding BPLR minus 2.5 percentage points |
| (d) Against undrawn balances (upto 90 days) | Not exceeding BPLR minus 2.5 percentage points |
| (e) Against retention money (for supplies portion only) payable within one year from the date of shipment (Upto 90 days) | Not exceeding BPLR minus 2.5 percentage points |
| 3. Deferred Credit | |
| Deferred credit for the period beyond 180 days | Free* |
| 4.Export Credit Not Otherwise Specified (ECNOS) | |
| (a) Pre-shipment credit | Free* |
| (b) Post-shipment credit | Free* |
BPLR : Benchmark Prime Lending Rate
Note : Since these are ceiling rates, banks would be free to charge any rate below the ceiling rates.
