Finance for Micro and Small Export Enterprises
World Trade Centre Jaipur and Export Promotion Council for Handicrafts Jodhpur came together to organize a workshop on export financing and various issues pertaining to forex management with exporters in small and medium enterprise sector at Jodhpur on 22nd July 2019.
Session speaker Mr. Jai Shekhawat- Vice President HDFC Bank explained the concept of Export Finance “an exporter may require short term, medium term or long-term finance depending upon the kinds of goods to be exported and the terms of declaration offered to foreign buyer.” For the same there may arise the need for term finance as for purchase of fixed assets and long-term working capital. Export finance is a short-term working capital finance allowed to an exporter not only to help export production but also to sell to overseas customers on credit.”
Elaborating further Mr. Jai said “at stages pre-shipment finance and post shipment finance becomes important. While The main objectives behind pre shipment finance or pre export finance is to enable exporter to effectively carry out manufacturing process Post Shipment Finance is a loan extended an exporter for shipment that has already been made. This is arranged from the date of spreading the credit after shipment of the goods to the recognition date of the exporter earnings.”
Advocating cash in advance for MSME exporters, Mr. Naresh Bothra, Chairman-Bothra International said “Cash-in-advance financing fosters export participation in particular of those firms that tend to experience greater difficulties in entering foreign markets. Cash-in-advance serves as a credible signal of quality and reduces part of the high uncertainty in international trade. When conditions of volatility exist in exports making it less profitable, cash-in-advance can help firms overcome productivity frictions if other firms signal their reliability in form of cash-in-advance. Despite higher implied costs, this in turn can facilitate entry into exporting, in particular for less productive firms.”
The program witnessed participation from manufacturers and exporters of handicrafts, furniture and textiles from Jodhpur region. The questions put up by young entrepreneurs were answered effectively by officials from Industries Department and Office of Development commissioner -Handicrafts-Jodhpur, Ministry of Textiles.
Vote of thanks was proposed by Mr. Navneet Agarwal-Assistant Director-WTC Jaipur
In the pic: (left to right) Mr. Gopal Sharma, Regional Head, EPCH -Jodhpur, Mr. Naresh Bothra- Chairman- Bothra -International, Mr. Nirmal Bhandari- Chairman- Bhandari Exports, Mr. Navneet Agarwal-Asst. Director-WTC Jaipur and Mr. Kiran V.N.-Assistant Director Office of Development commissioner -Handicrafts-Jodhpur, Ministry of Textiles.