8 ways to counter Re appreciation impact: FICCI

New Delhi, Aug 3: To compensate the exporters effectively for the loss incurred as a result of Rupee appreciation in the last few months, industry chamber FICCI has sought enhanced relief package for them.

It has suggested eight measures for the purpose which include addition of more products under the relief package, increasing drawback/DEPB rates from three per cent to five per cent, reduction in interest on export credit below five per cent, increasing Value caps and allowing conversion of shipping bills.

In addition, FICCI has also favoured a package for EoUs and for exports against Free Shipping Bills and income tax incentive for exporters.

A survey conducted by the chamber found that the relief package announced by the Government for exporters was inadequate and neutralises the impact of Rupee appreciation to a limited extent only.

It noted that a number of products, for which we have significant exports, drawback/DEPB rates have not been increased under the relief package as it was meant for only nine sectors.

In case of automobiles, the survey observed that the loss incurred by one commercial vehicle manufacturer as a result of Rupee appreciation was Rs 1,16,000 per vehicle. And, after factoring in the benefit from the existing relief package still the loss incurred is close to Rs 99,000 per vehicle for which the price is around Rs 11 lakh.

In recent months, Rupee has appreciated as much as 11 per cent against the dollar which has affected the growth of exports.

UNI