Exports payments worth Rs 100 crore pending with Iran
KOLKATA: Exporters' payments for shipments to Iran are held up to the tune of Rs 100 crore due to lack of clear banking mechanism and channels, causing hardship to the exporting firms, EEPC India has said.
The apex body of engineering exporters has received representations from its various members explaining how their payments have been blocked. "Under the Foreign Trade Policy, exports to Iran allow exports proceeds to be treated at par with Foreign Convertible Currency (FCC). The modus operandi is through UCO Bank. The Indian banks are not handling payments or any form of commercial transaction and hence the UCO Bank was allowed to handle rupee proceeds. But Iranians do not have rupee balances but they are willing to pay in FCC," the EEPC India said in a statement.
"As a result of the problems, the payments are held up and goods are detained at sea ports leading to demurrage and detention. With every passing day the demurrage and detention is multiplying and exporters run the risk of losing the money, as buyers may refuse to accept the cargo charges," it said.
The EEPC India said the issue has been pending before the authorities for quite some time and discussions have also been taken at different levels. "No solution has come yet. As a result, companies are not receiving their payment It is estimated that over Rs 100 crore are pending for payment by the Iranians to Indian exporters," it said.
Suggesting options, the body said that the UCO Bank should be allowed to accept FCC or Euro from Iran and Electronic Bank Realisation Certificates (eBRC) be issued.
The apex body of engineering exporters has received representations from its various members explaining how their payments have been blocked. "Under the Foreign Trade Policy, exports to Iran allow exports proceeds to be treated at par with Foreign Convertible Currency (FCC). The modus operandi is through UCO Bank. The Indian banks are not handling payments or any form of commercial transaction and hence the UCO Bank was allowed to handle rupee proceeds. But Iranians do not have rupee balances but they are willing to pay in FCC," the EEPC India said in a statement.
"As a result of the problems, the payments are held up and goods are detained at sea ports leading to demurrage and detention. With every passing day the demurrage and detention is multiplying and exporters run the risk of losing the money, as buyers may refuse to accept the cargo charges," it said.
The EEPC India said the issue has been pending before the authorities for quite some time and discussions have also been taken at different levels. "No solution has come yet. As a result, companies are not receiving their payment It is estimated that over Rs 100 crore are pending for payment by the Iranians to Indian exporters," it said.
Suggesting options, the body said that the UCO Bank should be allowed to accept FCC or Euro from Iran and Electronic Bank Realisation Certificates (eBRC) be issued.
