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Exporters smile as Re. plunges vis-à-vis the greenback |
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29/08/2008 |
| It’s a win-win situation now, notes Fieo chief
The depreciation of the rupee, which has hit a 17-month low of Rs 44.10 against the dollar, is good for exporters to remain competitive, the Federation of Indian Export Organisations (Fieo) President, Mr Ganesh Kumar Gupta, said.
He agreed that it was a win-win situation for exporters. "If the current exchange rate continues, we will certainly grow by 35 per cent and the total exports would exceed the target of $ 200 billion", he predicted.
Although the Gems and Jewellery Export Promotion Council (GJEPC) Chairman, Mr Sanjay Kothari, expressed happiness with his dollar earnings giving him extra profit, he preferred a stable rupee-dollar rate.
"We would rather have the rupee steady at 42-43 as it would give us a clear picture when we make our forward contracts", he explained.
With the reversal of trend in the exchange rate, exports have grown by 22.3 per cent in the first quarter of this fiscal to $ 42.84 billion.
In 2007-08, exports grew by 23 per cent to $ 155.5 billion, despite the rupee appreciating by over 13 per cent.
Mr S.P. Agarwal of the Indian Institute of Foreign Trade (IIFT) observed that the rupee fall would mean costlier imports, forcing the industry to increase the use of indigenous technology and content for value-added exports.
"The industry would resort to value-addition and would be able to quote competitive prices for their products in the global market", he added.
He, however, reminded that exporters who had not hedged the currency at the time of the rupee appreciation would benefit the maximum from the depreciating currency.
Over 60 per cent of the exporters had preferred hedging when the rupee was rising as they did not want to take any risks.
Source: Exim News Service-New Delhi, Aug |
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