The Commerce Ministry is guardedly optimistic that the persistently negative trend in the country’s exports might lift after September, despite the ‘grim’ ground level position with exports hovering in the negative zone since last October.
Highly-placed sources in the Ministry told Business Line here that the tentative export receipts for July 2009, which would be released on September 1, show that exports nosedived by 26.1 per cent in dollar terms for the fourth successive month in the current fiscal. Cumulatively, exports during April-July 2009 at $40.74 billion were down by 32.1 per cent as compared with $60 billion in the corresponding months of 2008.
Base effect
The sources said since the country’s exports were growing at a fast clip of 30 per cent during the first half of 2008-09 and began sliding from October, the base-effect of the high growth had to work itself out till September 2009.
“As I said earlier, we need to wait till September 2009 to assess the prospects for the remainder of the year,” the Commerce Secretary, Mr Rahul Khullar, said.
Reacting to the adverse tentative export numbers for July, the President, Federation of Indian Export Organisation (FIEO), Mr. A. Saktivel, said the exporters had communicated to the authorities at the Board of Trade meeting held here on August 10 the need for some “ad hoc and mitigating measures”.
He said that without waiting for the Drawback Committee to work out the details, the Government could announce an across-the-board increase of 5 per cent in drawback rates to help cushion the exporters.
He hoped that the forthcoming foreign trade policy would make efforts to simplify procedures and beef up the supporting infrastructure for exports by reducing transaction costs to trade and industry.
Source : Business Line