Multiple choice

RBI has raised cap on exports credit interest rates because

  1. it has been revised in sync with foreign currency deposits

  2. it has been revised in line with global rates

  3. it has been revised in consonance with WTO commitments

  4. it has been revised keeping in view the international export credit pricing

  5. none of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

RBI adjusts export credit interest rate caps in response to changes in global interest rates to maintain competitiveness of Indian exports. When global rates rise, the cap is raised to prevent exporters from being disadvantaged relative to foreign competitors, and vice versa. This aligns Indian export credit pricing with international market conditions.

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