Indian exporters are facing payment delays, trade finance disruptions and rising working-capital pressures due to the ongoing West Asia crisis, said Federation of Indian Export Organisations (FIEO) during a meeting with the Department of Financial Services, which assured that the issues would be looked into. Mr Ajay Sahai, Director General of FIEO, said longer shipping routes and vessel diversions are complicating export documentation and delaying settlement cycles for exporters. Extended transit times are creating risks related to letters of credit (LCs), expiry of trade documents and delayed realisation of export proceeds, while exporters may also face higher financing costs if shipments are treated as overdue by banks. Exporters warned that the combined impact could increase the effective cost of export credit by about 5.75-6.75%, adding liquidity pressure on firms already dealing with freight surcharges and logistics disruptions, according to a report.
Please visit our youtube channel https://www.youtube.com/@ikargos2719 for fortnightly logistics news analysis and more!