Industry body Assocham has further lowered its outlook for India’s exports to USD 255-260 billion for 2015-16, which stood at USD 310 billion in the previous fiscal, disagreeing with the government’s claim that there is “no crisis” on the outward shipments front.
Assocham in September this year had forecast the country’s exports to be around USD 265-268 billion.
Cumulative value of exports during April-November 2015-16 stood at USD 174.30 billion as against USD 213.77 billion in the same period last year, down 18.46 per cent.
Contraction in exports continued for the 12th month in a row in November as outward shipments shrank 24.43 per cent to USD 20.01 billion amid a global demand slowdown.
“Given the further decline in the last few months, the chamber is revising its outlook downward, disagreeing with a pre-dominant government view as if there is no big problem in the sector,” Assocham stated.
Facing flak for 12 straight months of decline in exports, the government had recently said there is “no crisis” in India on the export front and there is “no need for alarm”.
“There is no crisis in India on the export front and while there is a need for caution, there is no need for alarm,” the Commerce Ministry had said in a statement.
However, Assocham said the sector is in real crisis which goes well beyond petroleum products, gems and jewellery to highly job-oriented leather and leather products and has engulfed the entire agri exports witnessing sharp falls.
“There is no point shying away from the crisis, if it is there. The answer lies in recognising the problem without sweeping it under the carpet and then finding a way out. After all, nobody in India or elsewhere, for that matter can be blamed for the global crash in demand,” Assocham President Sunil Kanoria said.
He said it would also not be correct to take consolation in the fact that the exports have fallen marginally in rupee terms.
“India’s balance of payments is calculated along with the current account deficit in dollar terms and exports have a major contribution. Therefore, one cannot take comfort in currency depreciation,” Kanoria said.