Dip In International Demand Led To Decline In Exports In India: FIEO

Dip in demand along with decline in the prices of oil, commodities and metal has affected India’s export. The country’s merchandise export has declined to $25.39 billion in December 2014 from $26.393 billion in December 2013, thus recording a dip by 3.77%.

“Many of the sectors which exhibited double digit growth like leather and apparels have also shown moderate growth this month. More surprising has been the decline in export of rice, spices, gems & jewellery, cotton yarn, fabrics, made-ups and handicraft. These are all labour intensive sectors and their slowdown will have a bearing on employment scenario as well,” said M Rafeeque Ahmed, president of Federation of Indian Exports Organisations (FIEO).

He added, “Huge efforts would be required in the balance three months of the current fiscal to reach the export target of US$ 340 billion. This would require average exports of US$ 33 billion per month as against US$ 26-27 billion per month in the past”.

According to FIEO, the depreciation of the Indian currency coupled with the slight rise in inflation has given India an edge in exports. It also suggested that to further boost the export sector, the government must re-introduce interest subvention scheme as well as exempt all export sectors from paying indirect taxes.