The Reserve Bank has extended the period of realisation and repatriation for exporters of goods and software from 6 months to 12 months to help them deal with the global economic slowdown.“The issue has since been reviewed and it has been decided, in consultation with the Government of India, to extend the above relaxation with effect from Oct. 1, 2012 till March 31, 2013,” RBI said in a notification.
This has been done in the wake of global economic slowdown leading to payment delay by the buyers abroad. It further said the provisions in regard to period of realisation and repatriation to India of the full export value of goods or software exported by a unit situated in a Special Economic Zone (SEZ) as well as exports made to warehouses established outside India remain unchanged.
Meantime, Federation of Indian Export Organisations (FIEO) President Rafeeque Ahmed has welcomed the RBI decision to continue with extension in the repatriation of export proceeds in view of continuing liquidity problems. He said that FIEO has already represented for extension of the said facility which was introduced in 2008 as ground realities are more or less the same.
FIEO Chief said extension in the repatriation period will provide relief to the exporters and will reduce the transaction time since they would no longer be required to approach authorized dealer for extension in repatriation period if it is within 12 months from the date of exports. Such a move can also be used by the exporters as a part of marketing strategy for promoting exports by offering longer period of credit, Mr. Ahmed added.
India’s exports fell for the sixth consecutive month in October by 1.63 per cent year-on-year, with trade deficit widening to a record $21 billion. For the first seven months (April-October) of the 2012-13 fiscal, exports have shrunk by 6.18 per cent to $166.92 billion.
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