US shutdown likely to impact India too

Press Trust of India Posted online: Tuesday, Oct 01, 2013 at 0000 hrs
Kolkata : Indian exports to America face the demurrage threat due to US shutdown in the world's largest economy, engineering exporters' body EEPC India said today.

"Commercial ports do not come under emergency service category, so there will be a delay in port services like clearing of goods from ports due to staff shortage. This may result in huge demurrage for exporters," EEPC India Chairman Anupam Shah said here today reacting to news of US shutdown.

Indian exports to the US accounts for 12-14 per cent of the total outbound shipments worth USD 300 billion, Shah said. In 2012-13, exports to the US was USD 36 billion.

In the US, the shutdown begins from today where non-emergency service workforces have been asked to go on leave without pay.

Shah said that if the US shutdown issue was not resolved immediately, then there will be impact on overall exports to the US, including engineering exports.

Engineering exports are close to 20 per cent of the total export basket of the country.

Shah said exporters are not able to extract the maximum benefit of the Indian rupee depreciation due to certain factors.

He said if the situation does not deteriorate further, then engineering exports may register a growth of 5-6 per cent for the month of September.

"If things do not turn worse then we hope to register 10 per cent growth in 2013-14 despite degrowth of 4.19 per cent during the April-August period of 2013-14," Shah added.

Shah also sought Rs 500-crore technology upgradation fund for capacity building if the country has to boost exports in this sector.