Struggling to survive, Indian apparel exporters have urged the Government to solve their issues regarding risk cover with Export Credit Guarantee Corporation (ECGC), a Government of India’s enterprise.
The issue has been limiting the scope of expanding the buyer base for India’s apparel exporters.
Apparel Export Promotion Council (AEPC) has assured that the issue, which has been pending since years, will be pushed with the concerned ministries.
A meeting was called by the AEPC and ECGC in Delhi to discuss various issues where exporters raised their concerns.
Narinder Chugh, permanent invitee to EC, AEPC who is also the MD at Million Exports, Ludhiana shared that the issue will be highlighted with the ministry. While he hoped to get a solution to the problem, he accepted that there are several issues with ECGC as many times ECGC officials have been found to ask irrelevant questions.
One of the major issues is to cover the pre-shipment as ECGC doesn’t offer this facility. Notably, the exporters have been demanding the same since last many years, but of no avail.
More on this, Rajesh Gupta, CA, SAN International, Gurgaon, said “We have raised this issue time and again, but nothing has happened. This is a hurdle to expand business especially with new buyers, and therefore we are very cautious while working with a new buyer as the risk is always higher.” The company is one of the well-known export houses of Delhi-NCR.
It is also pertinent to mention here that in specific issues related to risk cover, PSU Banks do not entertain exporters if the latter are not associated with ECGC.
Another exporter of Delhi, Sushil Agarwal, MD, Eve Fashion informed that quality of shipped goods is also an issue, which is misused by the buyers. ECGC officials suggested that third-party audit and quality checking before shipment are the best options in this case.
ECGC officials are also of the view that compliance of policy is one of the most important points as there are cases where policies and circumstances are almost similar but exporters who have fully followed compliance of policy gets claim, while those who do not are refused claim.