Electronic and Computer Software Export Promotion Council

Interest Equalisation Scheme

Interest Equalisation Scheme on Pre & Post Shipment Rupee Export Credit with effect from 1st April, 2015 for five years

The RBI has extended the Interest Equalization Scheme for exporters till June 30, 2021

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has given its approval for Interest Equalisation Scheme (earlier called Interest Subvention Scheme) on Pre & Post Shipment Rupee Export Credit with effect from 1st April, 2015 for five years. The scheme will be evaluated after three years.

The following are the features of the Interest Equalisation Scheme:

Financial implication of the proposed scheme is estimated to be in the range of Rs. 2500 crore to Rs. 2700 crore per year. However, the actual financial implication would depend on the level of exports and the claims filed by the exporters with the banks. Funds to the tune of Rs. 1625 crore under Non-plan Head of account are available under Demand of Grants for 2015-2016, which would be made available to RBI during 2015-16.

The scheme will help the identified export sectors to be internationally competitive and achieve higher level of export performance.

The scheme covers mostly labour intensive and employment generating sectors like processed agriculture/food items, handicrafts, handmade carpet (including silk), handloom products, coir and coir manufactures, jute raw and yarn and other jute manufactures, readymade garments and made ups covered under Chapter 61-63, fabrics of all types, toys, sports goods, paper and stationary, Cosmetics and Toiletries, Leather Goods and footwear, Ceramics and Allied Products, Glass and Glassware, Medical and Scientific Instruments, Optical Frames, Lenses, Sunglasses Etc., Auto Components/Parts, Bicycle & Parts, Articles of Iron or Steel (Notified lines), Misc. Articles of base metals (Notified lines), Industrial Machinery, Electrical and Engineering items, 1C Engine, Machine tools, Parts (Notified lines), Electrical Machinery and Equipment (Notified lines), Telecom Instruments (Notified lines) and all items manufactured by SMEs other than those covered above.

The list of 416 tariff lines is given below:

S.NoSectorCoverageNo of HS4 lines
1Process agriculture/Food itemsAll lines22
2HandicraftAll lines37
3Carpet (Excl. Silk) HandmadeAll lines5
4Handloom ProductsAll lines2
5Coir & Coir ManufacturesAll lines5
6Jute Raw, YarnAll lines2
7Other Jute ManufacturesAll lines1
8Readymade Garments and Made ups ( Ch 61-63)All lines 42
9Fabric of all typesAll lines33
10ToysAll lines1
11Sports GoodsAll lines8
12Paper, StationaryAll lines8
13Cosmetics and ToiletriesAll lines8
14Leather Goods and footwearAll lines7
15Ceramics and Allied ProductsAll lines12
16Glass and GlasswareAll lines17
17Medical and Scientific Instruments ,All lines15
18Optical Frames, Lenses, Sunglasses EtcAll lines4
19Auto Components/PartsAll lines6
20Bicycle & PartsAll lines3
21Articles of Iron or SteelNotified lines20
22Misc. Articles of base metalsNotified lines10
23Industrial Machinery, Electrical and Engineering items, 1C Engine, Machine tools, PartsNotified lines141
24Electrical Machinery and EquipmentNotified lines1
25Telecom InstrumentsNotified lines6
26All items manufactured by SMEs other than those covered aboveAll items manufactured by SMEs other than those covered above0
Grand Total416