Despite appreciating rupee: FICCI survey
Despite the fragile global economic recovery and the appreciating rupee, exporters are confident of growing business during the next six months following improved demand in the traditional markets of the US and the European Union (EU), a survey conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI) has said.
The survey, based on responses of 254 exporting companies with a wide geographical and sectoral spread, was conducted during September-October this year. “Nearly 64 per cent of the participating firms feel that overall export conditions are much better compared to the situation six months back,” it said.
The survey found that while buying activity in global markets has increased in recent times, the conditions for payments from buyers have also improved. About 75 per cent of the participants surveyed noted that their expectations were “even more encouraging” than the performance in the first few months of the current fiscal.
With growing global demand for Indian merchandise and in keeping with Commerce and Industry Minister Anand Sharma's recent statement that the country would achieve the US$ 200-billion export target for the current fiscal, the FICCI survey revealed that importers of gems and jewellery, handicrafts and textiles in US and EU are stocking up in the expectation of better demand in their markets in the wake of upcoming festive season.
India's traditional markets are the US and EU which account for a third of the country's merchandise exports. It may be noted that the pick-up in confidence is despite the appreciation of the rupee against the US dollar which leads to erosion in export margins. Since January this year, the rupee has already appreciated by about five per cent against the greenback.
“The adverse movement in the value of the rupee blunts the effectiveness of these efforts leaving the exporters in the same position from where they started – one of compressed margins and profitability,” FICCI said.