Chidambaram says favours cheap loans for exporters

MUMBAI Fri Sep 27, 2013 9:22pm IST

Finance Minister Palaniappan Chidambaram speaks at the Indian Private Equity and Venture Capital Association (IVCA) conclave in New Delhi July 16, 2013. REUTERS/Anindito Mukherjee/Files

Finance Minister Palaniappan Chidambaram speaks at the Indian Private Equity and Venture Capital Association (IVCA) conclave in New Delhi July 16, 2013.

Credit: Reuters/Anindito Mukherjee/Files

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MUMBAI (Reuters) - The finance ministry is in talks with the Reserve Bank of India (RBI) to make bank loans cheaper for exporters, Finance Minister P Chidambaram said on Friday, a move that could help reduce wide current account deficit by boosting export income.

Exporters have been lobbying to be included in a category of priority lending that guarantees easier access to bank credit and lower interest rates, a privilege usually reserved for agriculture and small businesses.

India's has the world's third largest current account deficit, a major factor in a recent rout of the rupee currency. Exports account for some 25 percent of GDP.

(Reporting by Mumbai Bureau; Writing by Krishna Das; Editing by Frank Jack Daniel)

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