Commerce and Industry Minister Suresh Prabhu will tomorrow discuss the credit-related issues of gems and jewellery exporters with bankers in Mumbai. The Gem & Jewellery Export Promotion Council (GJEPC) is organising a banking summit in the maximum city to discuss credit-related matters. The industry has been urging bankers not to reduce their current credit limits as this would hamper and erode exports and employment creation. “We want to address their problem. It’s a genuine problem. They are facing lot of challenges. We will tell banks to come out with a foolproof system but do not deprive the sector of credit,” Prabhu told PTI.
The meeting assumes significance as the Reserve Bank in March banned issuance of letters of undertaking (LoUs) and letters of comfort (LoCs), used extensively for trade finance, following the Nirav Modi fraud case. Commerce Secretary Rita Teaotia, Financial Services Secretary Rajiv Kumar and SBI Chairman Rajnish Kumar would participate in the deliberations, among other government, industry and bank officials.
The country’s gems and jewellery exports contracted by 8 per cent to about USD 32.72 billion in 2017-18. Main export destinations are the US, Europe, Japan and China. America accounts for about one-fourth of the country’s total gems and jewellery exports. The labour-intensive sector contributes about 14 per cent to the country’s overall export.