Seminar on Foreign Exchange & Credit Risk Management at Pondicherry
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The Southern Region office of FIEO organized a Seminar on ‘Foreign Exchange and Credit Risk Management’ on 8th August at Pondicherry. The Seminar, organized in association with Directorate of Industries and Commerce of Pondicherry, Hongkong and Shanghai Banking Corporation (HSBC), Export Credit Guarantee Corporation (ECGC) and SME Rating Agency (SMERA), was attended by more than 60 exporters. While welcoming the participants to the Seminar, Mr. Tapan Chattopadhyay, Deputy Director General, FIEO (Southern Region) |
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Mr. Tapan Chattopadhyay addressing the meeting. Sitting on the dais from left, are Mr. Rajan, Dy. Director, Directorate of Industries and Commerce, Govt. of Pondicherry; Mrs. Vasantha; Mr. B R Babu; Mr. Muffadal Bhagat; and Mr. R Asokan, Jt. Director, FIEO(SR). |
observed that payments for exports were prone to risks even at the best of times and said that these risks were assuming larger dimensions due to far-reaching political and economic changes sweeping the world. In addition, said he, exporters were also exposed to usual commercial risks of insolvency or protracted default of buyers. He suggested the participating exporters to secure such risks by various means; at the same time, he warned them that overcautious attitudes towards such risks might result in loss of their hard-earned business orders.
Referring to credit needs of SMEs, Mr. Chattopadhyay stressed on the significance of credit rating by independent agencies, which, he said, might help the SMEs enjoy more favourable credit terms, lower rate of interest, fewer collateral requirements, simplified lending norms, and above all, faster access to credit.
Mr. B.R. Babu, Managing Director, Pondicherry Textiles Corporation Ltd., during his address referred to various restrictive trade practices adopted by the developed countries against the developing countries like India and felt that FIEO should fight out non-tariff barriers to ensure greater market access for Indian products & services. On the other hand, he advised the exporters to enhance their competitiveness in the face of Pakistan and other neighbouring countries becoming more and more cost competitive in textiles and other manufactured products.
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Mr. Muffadel Bhagat, Manager Trade Services, HSBC made a presentation on various trade advisory services offered by his bank like 24 hour processing facilities, follow up for payment, instant information services etc. He also spoke in length about ‘factoring’ and advised the exporters to make use of it to secure their payments and to manage their working capital requirement. |
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A view of the participants. |
Mr. Jethmal Khandelwal, Territory Manager, SMERA, made a presentation on how SMERA ratings were providing additional comfort to the commercial lenders and said such ratings could serve as bargaining chips for the SMEs to secure better credit terms from the banks. He explained in detail the objective, procedure and cost of such ratings.
Mrs. Vasantha, Branch Manager, ECGC explained about various credit risk policies offered by the ECGC and advised the exporters to consult the Corporation to know the credibility of their new buyers before executing any orders to them in order to avoid future losses.
