Scheme's intention stymied on ground

Well-intended schemes are not being fully implemented in letter and spirit at operating levels

In 2015, the central government renamed the earlier interest subvention scheme an interest equalisation scheme. And, decided to give a rebate of three per cent on the interest rates for pre-shipment and post-shipment credit.

The scheme covered all export of micro, small and medium enterprises (MSMEs) and by all manufacturers of items covered under 416 tariff lines (mostly labour-intensive and job-generating sectors). However, the scheme was not available to merchant exporters.

Last November, it raised the interest equalisation to five per cent of all MSMEs’ export. Last month, merchant exporters were also extended the three per cent interest equalisation. The Reserve Bank