Interviews
'Pakistan textile industry in trouble'
21 Aug '15
4 min read
Chinese yuan, backed by foreign exchange reserves of $3.9 trillion, has fallen 3 per cent in the past few days. Earlier, Japanese yen depreciated by 22 per cent.
“What our policymakers probably do not realise is that there is a low-intensity trade war going on in the face of slow growth in world trade, especially of imports by the EU, Japan and the US,” the think tank commented.
The IPR recommended two policy options. Either the government should move away from its policy of maintaining the nominal exchange rate and adjust it downwards, at least to the extent of rise in costs due to recent tax moves and pricing of electricity.
Alternatively, if the government is unwilling to abandon the exchange policy, then it may opt for an export rebate scheme covering most exports. (SH)
“What our policymakers probably do not realise is that there is a low-intensity trade war going on in the face of slow growth in world trade, especially of imports by the EU, Japan and the US,” the think tank commented.
The IPR recommended two policy options. Either the government should move away from its policy of maintaining the nominal exchange rate and adjust it downwards, at least to the extent of rise in costs due to recent tax moves and pricing of electricity.
Alternatively, if the government is unwilling to abandon the exchange policy, then it may opt for an export rebate scheme covering most exports. (SH)
Fibre2Fashion News Desk – India
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