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FIEO expects 20% fall in India's exports during FY21

May '20
Pic: Shutterstock
Pic: Shutterstock
India’s exports are expected to fall by 20 per cent in this fiscal because of the COVID-19 pandemic, according to the Federation of Indian Export Organisations (FIEO), whose director general and chief executive officer Ajay Sahai recently said the outlook is ‘extremely negative’ at the moment and fall in exports will also be accompanied by a decline in import.

“In value terms, this will be around $50 to $60 billion," Sahai said. He, however, said there will be no significant pressure on the balance of trade as both exports and imports are expected to fall.

Speaking on the stimulus package announced by the government, he said exporters need more support to improve their competitiveness in the global markets as China has started production.

"Personally, I feel there has been not a single word on exports in the economic stimulus announced by the government. Only favour which the government has done is by extending the interest subvention scheme of MSMEs," Sahai was quoted as saying by a news agency.

"Though the rupee has depreciated, it is not as sharp as what our competitors like South Korea, Turkey, Indonesia or Brazil have witnessed," he said, adding that this is putting pressure on Indian exports.

The apex body of exporters has requested the government to provide 2 per cent additional Merchandise Exports from India Scheme (MEIS) support to all exports and 4 per cent to labour-intensive sectors like apparel, leather, handicraft, carpets, marine, tea and processed food.

Earlier in a press release, FIEO president Sharad Kumar Saraf said though the stimulus package announced by the government has been encouraging and help in medium to long term, there still remains concerns regarding stimulating demand and tackling supply and supply chain disruptions that would have been the key to boosting the overall trade and industry immediately during such challenging times.

The need of the hour was to provide a much needed bailout package both in the form direct and indirect incentivisation for the trade and industry especially the exports sector looking at the global scenario, said Saraf.

Fibre2Fashion News Desk (DS)

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