The Reserve Bank of India (RBI) has rolled out
a powerful relief package for exporters who are currently grappling with rising
global headwinds. These moves aim to ease cash flow pressure, loosen tight
credit conditions, and give exporters more breathing room during these
uncertain times.
What’s Changing?
1. Longer Time to Bring Back Export Money
Exporters now have 15 months (up from 9
months) to repatriate the full value of their export proceeds - covering goods,
software, and services.
2. More Time for Advance Payments
If exporters received advance payments, the
timeline to ship those goods has been drastically extended: now up to 3 years
(or as per the contract), instead of just a year.
3. Moratorium on Loan Repayments
For certain “stressed” export sectors, all
term loan installments and interest on working-capital credit due between
September 1 and December 31, 2025, can now be deferred.
4. Revised Credit Norms
- The maximum credit period for pre-shipment and post-shipment export credit has been extended from 270 days to 450 days, for loans disbursed until March 31, 2026.
- Exporters who took packing credit before August 31, 2025, but haven’t yet shipped goods, can now liquidate these funds via alternate legitimate sources- like domestic sales or substitute export contracts.
5. Lenders Get Flexibility
Banks are allowed to recalculate the drawing power of exporters’ working capital loans by tweaking margins or reassessing needs.
6. Asset Classification Relief
For the period when the moratorium is in effect, regulated entities (like banks) won’t treat it as a restructuring. Also, interest during this time will accrue on a simple interest basis, with no compounding.
7. Provisioning for Lenders
Lenders must set aside at least 5% provision by December 31, 2025, for eligible accounts that were ‘standard’ (i.e., not bad loans) as on August 31, 2025, but have been granted relief.
8. Export Sectors in Focus
These relief measures apply to a broad list of 20 sectors including chemicals, textiles, iron & steel, leather, vehicles, machinery, precious stones, and more.
Why Is RBI Doing This?
The central bank says the reforms are meant to tackle the fallout from global trade disruptions - especially as Indian exporters face tighter payment cycles and uncertainty abroad.
Some key reasons for the timing:
- Exporters are struggling to ship goods and receive payments on time.
- Many sectors, like textiles, leather, and iron & steel, are particularly exposed to global volatility.
- The RBI’s relief coincides with a broader government push: recently, the Union Cabinet approved two major export-focused schemes, including a ₹25,060 crore Export Promotion Mission (EPM) and a ₹20,000 crore Credit Guarantee Scheme.
What This Means for Exporters
- Liquidity lifeline: With more time to bring back money and repay loans, exporters can manage cash flows better in the short term.
- Less working capital stress: Longer credit terms and flexibility around drawing power give much-needed breathing space.
- Alternative paths if shipments get delayed: Exporters holding goods can still convert their packing credit into cash via legal routes like domestic sales.
- Credit health assurance: Because this isn’t being treated as restructuring, it helps maintain the health of borrowers’ credit ratings.
Bottom Line: