FIEO welcomes 2.91% increase in Feb exports
FIEO President Sharad Kumar Saraf says the impact of coronavirus pandemic will be more visible in India’s exports figure of March onwards as will be the situation with major economies.
Welcoming the nominal growth in February 2020 exports by 2.91% at US$27.65 billion as encouraging, he felt that the Novel Corona Virus will not only pull down the global sentiments but also affect the supply chain both internationally and domestically.
Sixteen out of the 30 major product groups were in positive territory during February including petroleum, engineering goods, organic and inorganic chemicals, drugs and pharmaceuticals, electronic goods, ceramic products & glassware, iron ore, man-made yarn/fabs/made-ups, handicrafts and handmade carpet, carpet, marine products, oilseeds and few agri products.
However, all other major sectors of exports including almost all labour-intensive sector of exports are still in negative territory, noted the FIEO chief.
Further imports of US$37.50 billion with a marginal increase of 2.48% during February has also been subdued.
With crude prices moving southwards and supply disruptions extending to Europe and the US, due to COVID19, more comfort is expected in imports during the next few months.
But Saraf highlighted that domestic issues including uncertainty over MEIS Scheme has been a major cause of concern as exporters are indecisive to firm up new contracts in the absence of clarity over MEIS beyond March 2020.
The problem of risky exporters has further compounded the liquidity problem as their GST and Drawback claims have also been held up, he pointed out.
He reiterated that the stalemate over MEIS for apparels and made ups should be resolved immediately.
Further with RoDTEP will go a long way in enhancing the growth prospects not only in the short-term but will also give it a much-needed boost in the medium and long-term.
However, the same should be notified with immediate effect for all the products with lead time of at least 3 months now so that exporters may factor the same in finalising new orders and making their transition to the new scheme smooth while continuing with MEIS in the interim period.
Going with the current trend, FIEO Chief is of the view that the total merchandise exports for FY 2019-20 will remain in the range of US$320-$325 billion ending the fiscal with a trade deficit of around US$155-$160 billion reducing the CAD further. fiinews.com
