Next fiscal will be painful for exports: Ficci
Monday, 05 January 2009, 15:54 IST   |    2 Comments
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New Delhi: Aggressive pricing by Chinese exporters, coupled with lack of credit flow and cancellation of orders, is crippling India's exports, which may go down further in the first half of 2009, said an industry lobby survey, released here Sunday. According to the report by the Federation of Indian Chambers of Commerce and Industry (Ficci), Indian exporters are facing 'meet the China price' challenge from across the market. Many Indian exporters have already cut their prices by an average 10-15 percent or even more in some cases to retain their hold in the market. Over 360 companies representing sectors like automotive, consumer durables, food and food processing, leather, marine products, gems and jewellery, textiles, IT and pharmaceuticals, participated in the survey. According to the respondents, despite the easing of the monetary policy by the Reserve Bank of India (RBI), banks are still maintaining their "conservative stance" towards export finance. Nearly 56 percent of the companies said they have faced at least a few cases of cancellation of orders. There have also been several cases where the international buyers have defaulted on their payments or are refusing to accept delivery of consignments. The respondents demanded that the government "do more" to bail them out of the crisis. Nearly 51 percent of the companies said they expect a dip in exports in the next six months, while 62 percent said export prices would further go down during the period. Most of the exporters are worried over the aggressive pricing by the Chinese exporters. Backed by their government, the Chinese exporters have reduced prices drastically in the international market, forcing others to follow suit. Close to 60 percent of the companies said they were going slow on fresh hiring.
Source: IANS
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