NEW DELHI: Seeking to encourage exports, the government has increased allocations towards interest subsidy scheme in the Budget to Rs 2,500 crore for 2018-19.
Under the scheme, labour intensive export sectors get credit at affordable rates.
The allocation for this scheme has been increased from Rs 2,000 crore in 2017-18. It was earlier Rs 1,100 crore.
Exporters body Federation of Indian Export Organisations (FIEO) said the increased allocation under the interest equalisation or subsidy scheme would help the export sector.
"Enhanced allocation for Remission of State Levies from Rs 1,555 crore to Rs 1,855 crore for the current fiscal and Rs 2,164 crore for the subsequent fiscal will help clear the backlog," FIEO President Ganesh Gupta said in a statement.
Sandeep Keshari, Director, North American Brands Group, said that the rise in the allocations will give a fillip to India's outbound shipments.
The government in November 2015 had announced 3 per cent interest subsidy scheme for exporters.
Further, the government has allocated Rs 80 crore for the Trade Infrastructure for Export Schemes (TIES).
This scheme provides funds for projects having an overwhelming export linkage like border haat, land custom station, testing facility, certification lab, dry ports and export warehousing.
In general, the total allocation for all export promotion schemes has been increased to Rs 3,551 crore for the next fiscal.
Finance Minister Arun Jaitley in his budget speech has said that the country's exports are likely to register a growth of about 15 per cent in the current fiscal.
Cumulatively, exports during April-December 2017-18 grew by 12.05 per cent to USD 223.51 billion.
In the last financial year, the country's total merchandise exports stood at USD 274.64 billion.