(Reuters) -India’s central bank announced trade relief measures on Friday for businesses impacted by the recent hike in U.S. tariffs, including a moratorium on all term loans to be paid by exporters that are due between September 1 and December 31, 2025.
U.S. tariffs, including a 25% punitive levy over New Delhi’s purchases of Russian oil, have raised export duties to as high as 50%, impacting businesses across sectors such as garments, jewellery, leather goods and chemicals.
During this moratorium period, interest would continue to accrue but will be “on simple interest basis, without compounding effect,” the RBI said.
The central bank also issued a list of 20 sectors impacted by the tariffs. Borrowers engaged in exports in any of these sectors would be eligible for the moratorium.
It also permitted the country’s exporters to repatriate earnings from their shipments in 15 months instead of the existing timeline of 9 months, to provide more flexibility for businesses in negotiating future contracts with overseas buyers.
Other measures from the RBI include raising the maximum credit period for export loans disbursed until March 31, 2026 to 450 days from 270 days and easing limits for shipment of goods to three years from the date of receipt of advance payment from the current time frame of one year.
These measures will come into force with immediate effect, the RBI said.
In September, Indian exporters, in a closed door meeting with top central bank officials, had sought a moratorium on loan repayments and a favourable exchange rate, Reuters had reported citing sources.
The RBI had previously allowed such deferments of loan repayments and extensions in repatriation timelines for exporters, especially in 2020 during the COVID pandemic.
India’s central government had approved spending 450.6 billion rupees ($5.1 billion) on support for exporters on Wednesday, including 200 billion rupees in credit guarantees on bank loans.
The country’s merchandise exports to the U.S., India’s largest market, fell nearly 12% year-on-year to $5.43 billion in September, after the 50% tariffs took effect in late August, with engineering goods shipments down about 10%.
U.S. President Donald Trump said earlier this week the United States was getting close to reaching a deal with India that would expand economic and security ties between the two countries.
(Reporting by Ashwin Manikandan Mumbai and Nishit Navin in Bengaluru; Editing by Krishna Chandra Eluri)
