Impact of Global Meltdown on Indian Dyestuff Industry | Global Scenario of Dyestuff Industry

Commenting on the economic crisis and recessionary trends, Mr Mehta said, "The economic turmoil gripping the developed nations all over the world has also undoubtedly affected our industry very adversely. A lion's share of dyestuffs from our country is exported to US, EU and South Asian Countries. Slow down of economy and recessionary trends for the last few months mainly in US and Europe has cast a shadow on our exports to these regions both directly and indirectly. Consuming sectors including garments and textiles, leather, etc., have been hit most seriously.

As more than 60 percent of dyestuffs products are consumed by these industries and coupled with the downtrend in the consuming industry, the impact has been very severely felt by the dyestuffs industry and direct exports in particular as well, as a consequence. As per available data, export growth has slipped to almost 10 percent in September 2008 vis--vis a robust average of 27 percent witnessed during the earlier months of the current fiscal."

Mr Mehta, commended the steps taken by the Government saying "No doubt infusion of liquidity by the recent Govt. measures like reduction in CRR and SLR, REPO rates etc. has brought in an additional Rs.100, 000 crores into the system and appreciation of the US dollar to almost Rs.49 in recent days has provided a much sought relief to our export fraternity although imports have become astronomically prohibitive."

But in a solemn voice he lamented that "Saddled with the high cost of inputs and accumulation of inventory on the one hand, exporters are facing the irony of cancellation of export orders in the changed scenario on the other hand. Drying up of orders mainly from countries like US, EU and Japan, we are afraid, is likely to hit our exporters harder in the next few months, if the present slow down in the global economy continues unabated."

Industry sources say that the year 2009 could be worse for the Dyes and Chemicals industry as compared with 2008. However, it is expected hopefully that the situation will be back in the normal stage and Indian Dyestuff industry will be recuperate its position in the world market.

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