New Delhi: India’s exports declined in October this fiscal, for the first time in any month in five years, and the country will miss the $200 billion target for 2008-09, a senior Commerce Ministry official said on Monday.
“I personally think if September and October are indicators for the coming months, we will miss the export target,” Director General of Foreign Trade R S Gujral said on the sidelines of an export award function here.
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The DGFT said the downturn in exports would “definitely impact on employment”. Job-oriented sectors like gems and jewellery, handicrafts, textiles and leather have been severely hit.
Commerce and Industry minister Kamal Nath has so far been optimistic of achieving the export target, while he admitted that there would be some impact of the troubles in the US and Europe — the two largest markets for the Indian exporters. “I am still confident we will be able to meet the target,” he said on 30 October.
After the country exceeded the export target of $160 billion in 2007-08, the commerce ministry set an ambitious goal of $200 billion shipment for this fiscal.
Global consultancy firm Dun and Bradstreet and industry body Assocham have expressed doubts over performance in exports. While Dun and Bradstreet foresaw the exports heading for a slowdown, Assocham said shipments would fall short of target by $40 billion.
Gujral also said that every sector has been adversely affected in October. “Earlier, engineering products had buoyancy. But now, even this sector has also declined,” he said.
Giving a message to exporters, the DGFT said that they have to re-examine their costing and price-competitiveness. “They have to look at alternative markets where there is no slowdown,” he added.
On 3 November, Singh constituted an apex group under his chairmanship to monitor and coordinate the government’s response to India Inc’s concerns to minimise its adverse economic impact on the country.
Emphasising more steps, Gujral said that there is a need to reduce credit problems faced by the exporters as they have not really benefited from the Reserve Bank of India’s measures.
Federation of Indian Export Organisations (FIEO) Director General Ajay Sahai said, “The Government will have to address the issues of liquidity, high cost of credit, insurance coverage for the SME sector, and delinking grants of export benefits from the realisation of export proceeds.”
“Something should be done in the next couple of months to boost the sentiment,” he added.
Video by Rahul Sharma