R. Vimal Kumar

Tirupur: The recent direction given by Orissa High Court asking Central Bureau of Investigation (CBI) to register a case and investigate into the alleged multi-crore forex derivative scam, has brought cheers to the knitwear exporters here who had felt cheated by purchasing ‘forex derivative’ products offered by banks.

Following the order, Tirupur Forex Derivative Consumer Forum (a group formed of aggrieved exporters) president Raja Shanmugam met the CBI officials at New Delhi on Tuesday.

He explained to them how State Bank of India and four new generation private sector banks in the city ‘lured’ 33 exporters to purchase the products to hedge against the risk of foreign exchange fluctuations experienced during 2007-08 fiscal.

“The CBI has now sought exporter-wise case details from us, which will be furnished to them quickly,” Mr. Shanmugam told The Hindu.

Losses

The exporters in Tirupur knitwear cluster reported to have suffered cumulative losses to the tune of Rs. 300 crore after they bought the exotic forex derivatives offered by the said financial institutions. The Orissa High Court gave the direction to the CBI based on the report filed by the agency after carrying out a preliminary investigation into the grievances of exporters across the country mentioned in a Public Interest Litigation (PIL) filed before the court.

The Orissa High Court bench observed in its order that “in view of national interest involving irregularities of huge amount due to faulty derivative contracts, we direct CBI to make a thorough probe after registering a case.”

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