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Signs of recovery in exports, but are we comfortable yet?
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Bikky Khosla | 18 Aug, 2009
Even as the government would have us believe that the export sector is showing signs of recovery, a survey by an industry body has revealed that 'a complete recovery for India's crisis-stricken exports sector would happen only by the year-end.'
India's exports fell 26 percent from a year earlier in July, while the country's imports during July fell 35 percent. Meanwhile merchandise exports had slipped 27.7 percent from a year earlier in June to $12.81 billion, after falling 29.2 percent in the previous month.
I get a feeling that despite the challenges of weak demand in the international market, frequent exchange rate fluctuations, increasing competition and high cost of credit, signs of an economic turnaround are now starting to appear. For instance, if we look at the trend of May-June, it shows a positive growth of 16.4 percent.
Although it would be too early to draw any conclusion about export growth, I think the real recovery of the sector will be when we get to the target we'd reached in October last year which is when the downslide started.
However with the Foreign Trade Policy (FTP) to be announced on August 27, the government has to at least think of certain short-term measures till things fall into place.
Compensation for inland freight costs and helping exporters to focus on emerging markets like Brazil, South Africa, Asian nations and Mexico can be a good start. The government should also encourage exporters to make use of the internet and internet-related tools to expand their reach and to explore new markets.
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Situating Nigeria's Indian interest
Chuks Agoha, CEO | Sat Aug 22 09:23:00 2009
Trade India editorials have become a 'must use' in our monthly planning schedule at QUIETSTORM NIGERIA. It has become an essential informative tool to business ingenuity,creativity, and progress.Its comprehensiveness and capacity to discuss every facet of investment options is an added advantage to boosting third world trade potentials.Published commentaries, shared opinions, and reactions enhance analytical leverages and discourse in many board rooms.We have had reasons to debate certain statistics presented, but we have also wisened up to its invaluable insights.
Signs of 'uncomfortable' recovery!
Vinay G. Joshi | Wed Aug 19 19:31:39 2009
Dear Mr.Bikky Khosla,Further to my earler posting on the above subject, i hereby summarise the points made in the interactive session by FIEO President with Com.Min. 1]Continuation of DEPB for next five years as DBK not covers all products.2]Rate enhancement-FPS,FMS,MLPS & VKGUY, extention till year 2012.3]Scheme to rebate ST/CST in view of GST on average basis.4]To promote branded Indian products, incentivising 2% additional benefits.5]Zero duty EPCG.6]Duty free fuel for exports under DEPB/DBK as per captive power plants produce exporters. 6]Additional products & markets to be included in FPS.7]Domestic procurement under all authorisation schemes.8]Tangible benefits to towns of export.9]Constitution of Export Facilitaion Board headed by PM.10]Enhancement of MDA scheme eligibility.11]Subvention of interest extended to additional sectors included,4.5%BPLR.12]Special tech.upgrade funds to all export units.13]Give boost to Clinical Trial Services from India.14]To encourage develop hub for supplies to South Asia. The presentation was on 34 counts, others irrelevant to MSME's.
The Hon'ble Comm.Min has also had interactive session with Chairpersons of Commodity Boards & EPC's.
All said & done, drought no probs, GDP no probs - can we achieve the set US$ 200 Bn export target vis-avis $157Bn last fiscal?
Today the Govt. states [-]1.7% inflation, one need not comment on spiralling prices.Speculation on commodity exchanges, rising oil price scenario, et al;!!?? Regards.
Signs of 'uncomfortable' export recovery!
Vinay G. Joshi | Wed Aug 19 18:05:42 2009
Dear Mr.Bikky Khosla,
No doubt India's exports dipped for last ten consecutive months due to overseas contraction of demand.
The statistics is an anamoly. If a $ got last fiscal, fetches lesser this fiscal in export pricing, inaddition to increased outward remittances.
Not denying the fact of shrunk, dipped, uncompetitive export aspects.
The decline in exports figures doesn't mention exclusion in total exports about last ten months ban / prohibition on export of food grains, its resultant products, cereals, edible oils etc; The imports have also declined narrowing the trade defecit.
The ensuing FTP should be encouraging with enhanced continuation of export incentives. Textiles, leather will be high on priority.FIEO has commented on declining credit offtake to non food sector. The commercial sector YoY decline 15.5% whereas the net bank credit to the Govt. was Rs 454K Cr. five fold increase.
FIEO's President has also had an interactive session with Commerce & Industry Minister in July 2009.
At the same time FTA with ASEAN is a cause to worry. The synthetic rubber can be imported into India whereas natural rubber is in export negative list.Farm produce imports duty cuts - tea & coffee 45% pepper 50%, crude palm / refined oil 37.5 & 45 resp.
The producers have already petitioned the Union Govt. on this issue which can affect their exports & domestic sales.
Hope the drought like situation is no spoil sport. 13 months food stock available! Regards
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