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RBI extends export credit rate cut to Sept

The Reserve Bank of India said on Monday it would extend a cut in interest rates on rupee export credit by six months to September 30.

In September 2001, the RBI had announced a reduction in the ceiling on interest rates for export credit by one percentage point. The cut was applicable to both pre-shipment and post-shipment credit and was meant to last till March 31, 2002.

"Considering subsequent developments, the facility of reduced interest rates to export credit has now been extended for a further period of six months," a RBI statement said.

The maximum rate that the banks could charge to exporters is 2.5 percentage points below prime lending rate for pre-shipment credit up to 180 days and for post-shipment credit up to 90 days, it said.

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