SME Times News Bureau | 14 Mar, 2020
Reacting to a nominal exports growth in February, by 2.91 percent at USD
27.65 billion during the month, FIEO President Sharad Kumar Saraf said that in
the wake of Novel Corona Virus, which not only pulled down the global
sentiments but also affected the supply chain both internationally and
domestically, such modest growth is encouraging.
However, the impact of pandemic will be more visible in exports figure
of March onwards, he cautioned.
FIEO Chief said that with major global players including China, US,
economies of Europe, Japan, South Korea, Australia, Russia, Gulf countries are
also facing the brunt as oil and commodity prices have also shown drastic
decline in recent days.
16 out of the 30 major product groups were in positive territory during
February 2020.
Further imports of USD 37.50 billion with a marginal increase of 2.48
percent during the month 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.
Sharad Kr Saraf said 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.
The FIEO President reiterated that the stalemate over MEIS for apparels
and made ups should be resolved immediately.
Further with RoDTEP announcement made today 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, he added.
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 USD 320-325
billion ending the fiscal with a trade deficit of around USD 155-160 billion
reducing the CAD further.