By IANS
New Delhi : Expressing concern over the rising value of Indian rupee against the dollar, Commerce and Industry Minister Kamal Nath Wednesday urged exporters to view the situation as an "opportunity" to explore unexplored markets.
"Rupee rise is definitely a concern, but I have also asked the exporters to take it as a challenge and an opportunity to look at newer countries and new markets," the minister told reporters here after a meeting with the exporters.
"I have also asked the exporters to look at their own efficiency, reducing costs and enhancing competitiveness," he added.
Exporters, however, did not seem to agree with the minister, as according to them the rupee would weaken further to Rs.35 a dollar giving rise to unemployment and bankruptcy of small and medium exporters across the country.
"With the rupee appreciating at such levels it is difficult to look at new markets. Exporters are gradually losing their capital and profits are getting completely eroded," said Ganesh Kumar Gupta, president, Federation of Indian Export Organisations (FIEO).
"If we are experiencing huge losses in our existing markets, how can we even look at newer markets? Even to venture into new markets we need funds, who is going to provide that?" Gupta asked.
Indian rupee has appreciated by over 9.5 percent since December last year against the dollar, which has affected the exporters' profitability by over 13 percent.
"This is a bloodbath in terms of prices and the industry is becoming unviable. We are going to face huge job losses of about 579,000 in this financial year coupled with closure of several mills across India," Prem Malik, chairman, Cotton Textiles Export Promotion Council.
According to the Council for Leather Exports (CLE), the export target of $160 billion for fiscal 2007-08, which was set by the government in April in the Foreign Trade Policy, can be met if certain remedies such as enhancing the DEPB (Duty Entitlement Pass Book) and duty drawback rates are enhanced.
"We can easily meet the export target (of $160 billion in 2007-08) if the government looks into our suggestions and implement them as fast as they can," emphasised Mukhtarul Amin, chairman, CLE.
The Commerce Ministry, in the meantime, has recommended certain concessions to the Finance Ministry such as enhancing the DEPB and duty drawback rates by five percent.
It has also suggested to the Finance Ministry to reduce the rate of interest on pre-shipment and post-shipment credit by six percent from the current level of 9-11 percent.
Kamal Nath has set up a committee comprising of all the leading trade bodies of the country to assess job losses in the next twelve months and the loss of export orders.