Industry sources, however, welcome certain modifications in the Exim policy. The proposed scheme of annual advance licences will help exporters in saving time. Details of the scheme should, therefore, be announced as early as possible, they say.

The modification of DEPB scheme, they add, will be helpful both to exporters and domestic producers. This would also encourage exporters to make use of indigenous materials as far as possible.

The lowering of thresh-hold limit for imports of capital goods on zero-duty basis under the EPCG scheme is also sought, since this will enable smallmanufacturing units to modernise themselves. However they add in this context that imports of second-hand shuttle-less looms under this scheme should be allowed since they are available cheaper by 20 per cent or more than the new equipment and there is no indigenous production of such looms.

While the new Exim policy has no immediate impact on exports of blended yarn, of late, there is some recovery in the overseas markets for such yarns. This is evident from the fact that blended yarn, 30s single P/V is now fetching about $1.70-1.75 per kg, against that of $1.60 per kg earlier.

The volume of P/V yarn exports which has considerably dwindled in the past is expected to improve, if the recovery in the overseas markets is sustained. Exports of polyester cotton (P/C) blended yarn from the country have been well maintained.

In view of domestic production of cotton, India is relatively in a better position in polyester cotton yarn exports to the overseas markets, as some of the competing countries like Taiwan,Korea, Indonesia and Thailand do not have domestic cotton. They therefore mostly blend polyester with viscose fibre to produce polyester/viscose (P/V) blends. There are, therefore, more competitors in the P/V market.

Meanwhile, the earlier expectation that polyester prices in the overseas markets may continue to harden has proved to be short-lived. The prices of PSF have again come down abroad to $0.50 per kg after being quoted for some time around $0.60 per kg. The PFY has also declined to $0.60 per kg from the earlier level of $0.70 per kg. Taiwan, South Korea and Indonesia are said to undercutting one another.

Domestic producers who were hoping for further hardening of polyester prices abroad find that their hopes have been belied. They have therefore, brought down their prices in the domestic market for PSF to Rs 40 per kg from Rs 41.50 per kg. Some producers are offering the material even at still lower levels. The domestic price for PFY is also said to have eased to Rs 45 per kg.

Exports of PSFfrom the country in Feb 1999 were nil compared to the earlier high of 2,066.74 tonnes in March 1998. Shipments of PFY in February 1999 stood at 1,816.47 tonnes compared with the earlier record of 8,802.51 tonnes in March 1998. Exporters find overseas markets for PSF and PFY excessively competitive.