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Fear of job losses, missing targets haunt exporters
January 05, 2009 18:54 IST
Expressing disappointment over the second stimulus package, exporters on Monday warned of 'huge' job losses and missing the export target of $200 billion for the current fiscal unless the government provides them further sops.
The Federation of Indian Export Organisations said there was no 'serious consideration' for the exporters in the measures announced by the government last week to stimulate the Indian economy, reeling under the impact of global meltdown.
It has asked the government to increase drawback rates for tax refunds and additional two per cent interest subsidy.
The government, in the stimulus package, had provided for an interest subvention of two per cent up to March this fiscal subject to minimum rate of interest of seven per cent.
"Unless the government considers the demands favourably, there will be huge job losses across the country and we will be nowhere near touching export target of $200 billion," FIEO president A Sakthivel said.
However, he did not elaborate on the quantum of the job losses feared.
The country's exports, which posted a robust 30.9 per cent growth in the first half of fiscal, contracted by 12.1 per cent in October, for the first time in the last five years.
The negative trend continued in November, when exports fell to $11.5 billion, from $12.7 billion.
India's exports totalled over $160 billion in 2007-08.
Sakthivel urged prime minister Manmohan Singh, who is also holding the finance portfolio, to consider exporters' demands favourably to avoid job losses.
A recent survey by industry body Ficci has said customers in the US and the UK were looking for Indian goods for prices at par with Chinese players. It said exports are likely to fall further in the coming six months.
China has increased VAT refund from nine per cent to 17 per cent, Sakthivel said.
Manufacturers of leather, handicrafts, textiles, knitwear, gem and jewellery will have negative effect on their export efforts (because of the Chinese move), Sakthivel said.
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