New Delhi: Finance minister P Chidambaram assured leather exporters on 12 June of shielding them from the strengthening rupee against the dollar and asked the community to look at high-value exports to boost overseas sales.
“Our meeting with Finance Minister was positive. He said government was aware of the problems faced by us and assured that something will be done about it,” Mukthalul Amin, chairman, Council of Leather Exports, told reporters.
He said the council representatives told Chidambaram that in the last eight weeks appreciation of the rupee against various currencies has eroded their margins by 6%.
“The finance minister advised us to look at high value-added exports, which the industry was already moving to, but he also understood that our main competiton was from China, which has tremendous cost advantage,” Amin said.
He said rupee appreciation has also impacted bookings for future as at new prices no new business was coming. The CLE will meet commerce minister Kamal Nath on 13 June.
According to M Rafeeque Ahmed, president, All India Skin and Hide Tanners and Merchants Association, who was in the delegation, the bookings for new season have started globally but Indian exporters were in a fix on what price to quote in a situation when the rupee value was fluctuating.
The current run of the rupee and increasing interest rates was resulting in a loss of 2-3% on shipments and if we quote a higher price no new orders would come, Ahmed said.