FIEO Chief urges immediate
execution of Relief Package
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Facing the camera Mr. Ganesh Kumar Gupta, President, FIEO (2nd from right) addressing the Press Conference at Chennai. On his right are Mr. A Sakthivel, Vice President, FIEO; Dr. R.K.Dhawan, Chairman, FIEO(NR) & Mr. S.K. Jain, Chairman, FIEO(ER). Mr. Ajay Sahai, Director General, FIEO (extreme right) |
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Addressing a Press Conference organized by FIEO in association with various export promotion councils at Chennai on 30th June, FIEO President Mr. Ganesh Kumar Gupta warned that if immediate steps were not taken to check fast eroding competitiveness of our exports due to appreciating rupee, then our members would lose exports to the tune of US$ 12.5 billion in the current fiscal. FIEO President also warned that the current slowdown in exports would have disastrous impact on employment and about eight million people would become jobless in the current financial year. He urged that the Finance Minister should immediately approve the relief package announced by the Commerce Minister on 13th June.
An opinion poll conducted by FIEO reveals that 15% of exporters are considering to reduce their workforce by 50%, 21% of exporters by 30-50% and 18% of exporters by 10-30% as a response to eroding profits due to stronger rupee. 46% of the respondents said that they had already begun laying off their manpower in view of reduced export orders.
FIEO Vice President Mr. A Sakthivel during his address observed that the current retail boom in the country was already pulling the exporters towards domestic market and if their export profits kept declining then they would be forced to switchover to the domestic market.
Rejecting the view that rupee appreciation is a temporary phenomenon, Mr. Sakthivel said that with continued slowdown of US economy and its account deficit nearing 7% of the GDP, the dollar would fall further. While asked, can exporters minimise the impact of rising rupee by cost-cutting and moving up the value chain, he said it is not viable as the exporters are already working on wafer thin margins.
Assessing the impact of stronger rupee on export orders, a Past President of FIEO, Mr. M Rafeeque Ahmed said "Most of us have orders that would keep us going till July. No new orders are coming. We have to complete the orders irrespective of our financial position."
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Identifying the sectors that are hit the hardest by strengthening rupee, the Northern Region Chairman of FIEO, Dr. R.K. Dhawan said operations in many units of handloom, textiles and leather sectors have come to a standstill rendering several thousand people jobless. Warning on the long term consequences, he said, "If we finalise orders at Rs. 40 to a dollar today and if tomorrow the rupee hits 37 or 38, the buyers will be the losers. They will go to China. And once they go to China they won’t come back to us." |
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| A view of the FIEO Managing Committee Members (left row) with media persons. |
The Press Conference was attended by representatives of various export promotion councils such as Mr. Sajeev Saran, Chairman, SRTEPC; Mr. M S Mathivanan, Chairman, Powerloom Development & EPC; Mr. T V Maruthi, Chairman, Indian Silk EPC; Mr. Rupchand Lohia, Chairman, Plastics EPC; Mr. T Vasu, Chairman, EPC for EOUs & SEZ Units; Mr. Vijay Agarwal, Chairman, AEPC; Mr. Samir Kumar Ghosh, Chairman, CAPEXIL, Mr. G K Raman, Regional Director, PHARMEXCIL. FIEO Managing Committee Members who attended the meeting included Dr. R.K. Dhawan, Chairman, FIEO(NR); Mr. S K Jain, Chairman, FIEO(ER); Mr. O P Garg, Immediate Past President, FIEO; Mr. M Rafeeque Ahmed, Past President, FIEO; Mr. Navratan Samdria, Past President, FIEO; Mr. A Nithiyanandan, Dy. Gen. Manager, Exim Bank; Mr. Walter D’Souza, Fernandes Brothers; Mr. Subhash Goyal, STIC Travels (P) Limited; Mr. N M Gupta, Sutlej Industries Limited; Mr. Shreepal C Jain, Rishabh Impex; Mr. Amit Goyal, Sarju International Limited; Mr. Irshad Mirza, Mirza Tanners Limited; Mr. Pravin Saraf, Saraf Impex (P) Ltd.
