Govt mulls higher interest subvention covering all exporters to reduce CAD

The government, in order to reduce the current account deficit (CAD), is considering the expansion of interest subvention to exporters.

After import duties were hiked on Wednesday, the commerce ministry is mulling the expansion of the Interest Equalisation Scheme, both in depth and range.

The scheme allows small and medium exporters in labour-intensive sectors to take loans from banks at a lower rate of 3 per cent. The ministry wants the scope of interest subvention to be expanded so that people taking loans at 5 per cent can be included, according to a senior official.

It is also weighing the option of expanding