The ban on letter of undertakings by the Reserve Bank that has hurt credit flows to trade, commerce minister Suresh Prabhu today said he has called a bankers’ meeting to iron out “impinging issues”.
“I want to call a bankers’ meeting soon and ensure that bankers and exporters talk to each other,” he said at exporters lobby Fieo event.
“We must work for the sectoral issues, which are impinging export growth. The banking system has actually lent enough to exporters in the past” we will have a banking system and exporters’ interaction soon,” he told reporters later.
It can be recalled that following the close to Rs 13,000 crore PNB scam involving diamond trader Nirva Modi and his uncle Mehul Choski, which took place using fake LoUs, came out in the open in February, the Reserve Bank had banned LoUs towards the end of the month, which has impacted exim trade.
He said without going into the definition of the priority sector lending, we need to understand that credit flow to exporters is the “most priority sector”.
GST refund delay is another issue and assured the trade that he will go to the finance ministry to resolve the issues.
With US protectionist posturing creating a question mark over the future of the World Trade Organisation, Prabhu said it is in our collective interest to save the global trade watchdog.
He said after blaming us for our stiff position for long, the world now has taken note of our contribution to “save” the WTO to ensure that world trade thrives.
Prabhu said he is “not happy” with the over 9 percent export growth, a multi-year high, to USD 302 billion posted in FY18 saying a we need to do more starting with a clear strategy on what to do.
He said we must go beyond the traditional segments and into newer geographies as well to achieve more exports, he said, adding for the first time, government is planning trade facilitation offices abroad.
Prabhu said his ministry is creating a logistics digitalisation plan and he has sought help from Singapore and the UAE for the same.
Sounding concerned over the “standstill” in Goa, he said mining is a very important activity and exhorted all for responsibly carrying out the activity.
On the much-delayed free trade agreement with European Union, Prabhu said he has prepared a checklist of things to be followed, which will act as a standard operating procedure before any pact is signed.