EXPORT Import Bank of India (Exim Bank) has opened a special funding window for micro, small and medium enterprises (MSMEs) planning to export their products. The development bank has also mobilised the Grassroots Business Fund, a US-based not-for-profit organisation, to offer seed capital to MSMEs for building export units. The initiatives are in sync with the country’s thrust on MSMEs.
According to Exim Bank chairman & managing director TC Venkat Subramanian, the special funding window has been created recently to support export marketing initiatives taken up by MSMEs. Exim Bank will reimburse 50% of the project cost. The CMD, however, did not specify the corpus of the new facility.
“We will offer export marketing finance to MSMEs as a grant. The facility would boost the sector, which has been the government’s focus for quite sometime,” Mr Subramanian said on the sidelines of a ‘Trade & Logistics Symposium, jointly organized by Indian Institute of Foreign Trade (IIFT) and Confederation of Indian Industry.
“We are also acting as facilitator for getting seed capital for MSMEs from the Grassroots Business Fund. The entity would take 20-25% equity in each MSME depending on the size of the unit,” the Exim Bank CMD said.
On the country’s overall export scene, he expected flat growth at 3% for this fiscal. In the inaugural session of the event, IIFT director KT Chacko underscored the need to improve transportation infrastructure in order to achieve sustainable export growth.
“In most of the state, there is no serious effort to improve transportation systems. Transportation cost is very high and this needs to be addressed. There is also largescale inefficiency in export logistics,” Mr Chacko observed.
He mentioned that since the export sector has created large-scale job opportunities, especially since 2004, export growth assumes that much importance for the country’s overall economic health.
In fact, the global economic downturn has impacted specifically the country’s textile and gems & jewellery sectors which are largely export-oriented. Yet, India’s export-GDP ratio is just about 15%, compared with the 30% ratio for China.
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