Handicrafts, fruits & veg exports most hit by Re rise

Written by ASHOK B SHARMA | New Delhi, Dec 12 | Updated: Dec 13 2007, 05:53am hrs
The declining trend in the fall in the value of the US dollar and consequent rise in the value of the rupee has severely affected the earnings of countrys exports. The exchange rate for one US dollar is Rs 39.35, which at one time used to be around Rs 45.

The impact has been more severe in those sectors whose inputs are less import-dependant, labour intensive and where value-addition is low. In response to the situation, the government is working out sops to be extended to exporters.

According to an estimate of the government, textiles export in value terms has registered a decline of 10.4% in the current fiscal till August as compared to the previous fiscal. Similarly export of other products like cotton yarn, fabrics and made-ups declined by 15.7%, that of leather and leather products by 2.4%, that of marine products by 13%, carpets by 19.2%, that of fruits and vegetables by 32%, that of cashew by 19.1%, that of coffee by 21%, that of tea by 33%, that of jute products by 17.4% and that of handicrafts by 58.4%.

In the past 15 months, the rupee has been appreciating against all the four major freely convertible currencies and in the last six months, it has recorded the highest appreciation against the US dollar. While the appreciation of the Indian rupee is a reflection, in part, of the growing strength of the economy and has positive economic benefits by way of cheaper imports but the rapidappreciation of the rupee had adversely affected the exporters, an official note said.