IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Outflow (subsidised)

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 05 Feb 2009 | Removal date: 05 Feb 2010
Still in force

Trade finance

On 5 February 2009, the Reserve Bank of India through Circular DBOD.DIR (Exp).No.107/04.02.001/2008-09 increased the interest ceiling rate on export credit in foreign currency.
 
The ceiling rates vary depending on the origin of the lender. For domestic banks, the ceiling has been raised from LIBOR/EURIBOR plus 100 basis points to LIBOR/EURIBOR plus 350 basis points. This rate is subject to the condition that the banks will not levy any other charges.
 
Further, the interest ceiling rate with overseas banks has been increased from LIBOR/EURIBOR plus 75 basis points to 150 basis points.
 
The interest rates have been periodically amended until being deregulated in May 2012 (see related measures)

AFFECTED COUNTRIES

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