In view of the disruption caused by the pandemic, the time period for realisation and repatriation of export proceeds for exports made up to or on July 31, 2020, has been extended to 15 months from the date of export.
The Reserve Bank of India (RBI) on Wednesday unveiled three fresh measures to ease conditions for exporters, state governments and banks amid the lockdown. This is the second set of measures announced by the central bank since Friday.
In view of the disruption caused by the pandemic, the time period for realisation and repatriation of export proceeds for exports made up to or on July 31, 2020, has been extended to 15 months from the date of export. At present, the value of goods or software exports made by exporters is required to be realised fully and repatriated to the country within a period of nine months from the date of export. “The measure will enable the exporters to realise their receipts, especially from the Covid-19 affected countries within the extended period and also provide greater flexibility to the exporters to negotiate future export contracts with buyers abroad,” RBI said in a circular.
Further, the central bank increased the ways and means advances (WMA) limit by 30% from the existing limit for all states and Union territories (UTs) to enable the state governments to tide over the situation arising from the virus outbreak. RBI had constituted an advisory committee to review the WMA limits for state governments and UTs. Pending submission of the final recommendations by the committee, the central bank has taken this measure. The revised limits will come into force with effect from April 1, 2020, and will be valid till September 30.
For banks, RBI has decided to put on hold the activation of the framework on countercyclical capital buffer (CCyB) for a period of one year or earlier. The framework had been put in place by the RBI in terms of guidelines issued on February 5, 2015, wherein it was advised that the CCyB would be activated as and when the circumstances warranted, and that the decision would normally be pre-announced. The framework envisages the credit-to-gross domestic product (GDP) gap as the main indicator, which is used in conjunction with other supplementary indicators.