Exporters paint a grim picture due to Re rise

New Delhi, June 13 (UNI) The appreciation of rupee by 9.7 per cent in the past seven months and 7 per cent in the past four months can result in 8-10 million job loss in the country.

Speaking to reporters today Federation of Indian Export Organistaions (FIEO) Director General Ajai Sahai said, "rough estimates done on the impact of rupee rise on unemployment pegged it at 8-10 million people with textile industry and SMEs being the worst hit" .

'' We are glad that the rupee has appreciated but a gradual rise would have been more appreciable,'' said FIEO President GK Gupta.

In the year 1991 the export industry rose to the clarion call of the government to make the Balance of Payment (BOP) favourable and now when the export industry is in trouble the government should do all it can to save the industry, he added.

Chairman Cotton Textile Board Prem Mallik said while textiles directly employed 35 million people, it was witnessing a sharp decline in exports. Sales had dropped by 13 per cent resulting in excessive capacity in the domestic market which could not absorb the excess supply.

'' This has resulted in a bloodbath for us and the problem has been compounded by fact that we are losing markets to our competitors,'' added Mr Mallik.

Apparel Industry Board Chairman Rakesh Vahi said sales of the apparel industry too has taken a beating as sales showed a downward trend of 2.5 per cent. Comparatively sales of China increased by a massive 63 per cent and Bangladesh by 64 per cent.

Though the export target of 9.5 billion dollar has been achieved for this year but with buyers asking for a discount of 2-3 per cent, the industry is now eating into the reserves, he added.

Amplifying the problems faced by the engineering sector, Engineering Industry Board Chairman S C Ralhan said pipes in India cost Rs 39 per kilo while the ones imported from China now cost Rs 27 per kilo. As a result the industry's engaged in the manufacturing of pipes have shut shop and have started to import.

'' We had set a target of seven billion for 2010 with a growth rate of 25 per cent. However, this year we have experienced a negative growth and have been laying off workers,'' said Leather Board Chairman Mukhtarul Amin.

However, the export fraternity was unequivocal in stating that Minister of Commerce and Industry Kamal Nath's linking of economic growth and rupee appreciation was not true and the rise in rupee was more so because of the unchecked FII inflow and RBIs non-intervention.

The exporters also questioned the comparision of 13.6 per cent industrial growth being linked to corresponding period last year. Infact the industrial production fell from a record 14.5 per cent in March this year.

UNI