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18-11-2025
Bureau Report
NEW DELHI: India’s Central Bank announced trade relief measures on Friday for businesses impacted by the recent hike in US tariffs, including a moratorium on all term loans to be paid by exporters that are due between September 1 and December 31, 2025.
US tariffs, including a 25% punitive levy over New Delhi’s purchases of Russian oil, have raised export duties to as high as 50%, impacting businesses across sectors such as garments, jewelry, leather goods and chemicals.
During this moratorium period, interest would continue to accrue but will be “on simple interest basis, without compounding effect,” the RBI said.
The central bank also issued a list, opens new tab of 20 sectors impacted by the tariffs. Borrowers engaged in exports in any of these sectors would be eligible for the moratorium.
It also permitted the country’s exporters to repatriate earnings from their shipments in 15 months instead of the existing timeline of 9 months, to provide more flexibility for businesses in negotiating future contracts with overseas buyers.
Other measures from the RBI include raising the maximum credit period for export loans disbursed until March 31, 2026 to 450 days from 270 days and easing limits for shipment of goods to three years from the date of receipt of advance payment from the current time frame of one year.
These measures will come into force with immediate effect, the RBI said.
In September, Indian exporters, in a closed door meeting with top central bank officials, had sought a moratorium on loan repayments and a favorable exchange rate, media had reported citing sources. The RBI had previously allowed such deferments of loan repayments and extensions in repatriation timelines for exporters, especially in 2020 during the COVID pandemic.
India’s central government had approved spending 450.6 billion rupees ($5.1 billion) on support for exporters on Wednesday, including 200 billion rupees in credit guarantees on bank loans. The country’s merchandise exports to the US, India’s largest market, fell nearly 12% year-on-year to $5.43 billion in September, after the 50% tariffs took effect in late August, with engineering goods shipments down about 10%.
US President Donald Trump said earlier this week the United States was getting close to reaching a deal with India that would expand economic and security ties between the two countries.
Earlier, India’s cabinet had approved spending 450.6 billion rupees ($5.1 billion) on support for exporters, including 200 billion rupees in credit guarantees on bank loans, Information Minister Ashwini Vaishnaw said on Wednesday.
The plan includes the allocation of 250.6 billion rupees over six years for affordable trade finance for small exporters, logistics and market support under an export promotion package to help offset the impact of recent US tariff hikes.
The new US tariffs, including a 25% punitive levy over New Delhi’s Russian oil purchases, raised duties to as high as 50% on items such as garments, jewelry, leather goods and chemicals.
Exporters said labor-intensive sectors such as textiles, jewelry and seafood, particularly shrimp which all operate on margins of just 3%-5% have been hit hardest, causing job losses in industrial hubs in Tamil Nadu and Prime Minister Narendra Modi’s home state of Gujarat.
The plan includes a 200-billion-rupee credit guarantee program running until March 2026 for collateral-free bank loans to exporters to boost their competitiveness and help explore new markets, Vaishnav said.
