Framework For Reducing Exporters’ Debt Burden Under Adverse Trade Conditions
- RBI has issued a notification dated Reserve Bank of India (Trade Relief Measures) Directions, 2025 on November 14, 2025 (Notification) which is for the benefit of those borrowers engaged in exports falling under eligible sectors and whose business is impacted by trade disruptions caused by global headwinds.
- A Regulated Entity (RE) may provide eligible borrowers with the following relief measures:
- Moratorium/Deferment on payment of all instalments of principal/interest on term loans or working capital facilities; or
- Enhanced credit period;
- Liquidation of goods by way of domestic sale proceeds.
- Moratorium will be applicable during the Effective Period (i.e., 01.09.2025 to 31.12.2025) on term loans or working capital facilities. However, during moratorium/deferment period the interest will continue to accrue on simple interest basis. Such accumulated accrued interest may also be converted into funded interest term loan which is payable in instalments not later than September 30, 2026.
- As regards working capital facilities an RE may recalculate ‘drawing power’ by reducing margins/reassess working capital limits during Effective Period.
- RE may permit an enhanced credit period of up to 450 days for pre-shipment and post shipment export credit disbursed till March 31, 2026. If any eligible borrower has availed packing credit facilities but goods were not dispatched RE may allow liquidation of such facilities from any legitimate alternate sources including domestic sale proceeds of such goods or substitution of contract with proceeds of another export order.
- RE shall exclude the moratorium/deferment period for the purpose of asset classification under IRAC norms. Grant of relief of moratorium/deferment shall not be treated as an event of restructuring and not result in asset classification downgrade.
- A borrower will be deemed eligible if the following conditions are fulfilled:
- Borrower is engaged in exports relating to any sector specified below;
- Borrower had an outstanding export credit facility from RE as of August 31, 2025;
- Accounts of Borrower is classified as ‘Standard’ as on August 31, 2025.
- The Notification includes a comprehensive table listing the eligible export sectors to which the trade relief measures apply which includes fish, leather, textile articles, footwear, plastic, rubber etc.
- In summary, RBI’s framework delivers targeted and calibrated relief to exporters facing global headwinds. The combination of relaxed repayment obligations and flexibility in handling export receivables provides tangible financial breathing room. These measures enhance sectoral resilience and position India’s export ecosystem to better withstand adverse market conditions.
