Apparel Export Promotion Council Asks For Measures To Check Rise Of Indian Rupee

Apparel, Footwear, Fashion

Apparel Export Promotion Council Asks For Measures To Check Rise Of Indian Rupee

The Apparel Export Promotion Council (AEPC) has called for a carefully “considered strategy” and “a pragmatic approach” to arrest the rise of the Indian rupee, which it has pointed out as the reason why Indian garment exports have failed to pick up. The trade body has attributed the failure of Indian garment exports to pick up to depreciation of currencies of India’s competitors like China, Bangladesh and Vietnam.

"Despite the Indian government's intentions and support to the industry, exports are hardly picking up. The primary reasons are a strong rupee and depreciation of currencies of our competing countries like China, Bangladesh and Vietnam," according to an AEPC statement. "Chinese yuan (renminbi) depreciated by 13%, Bangladesh Taka by 6% and Vietnam Dong by 7%, whereas India's rupee hardened by almost 6% over the last three to five months," the AEPC statement said, adding that China received the highest foreign direct investment during this period.

The AEPC statement said that the apparel industry was very hopeful after a special package was offered to it in June 2016, where significant financial and investment incentives were offered, along with critical labour flexibilities, with the aim to generate 100.3 lakh additional jobs and US $30.04 billion in additional exports.

"Increasing cotton prices and rupee appreciation are not only going to nullify the intended impact of that package, but also weaken India's position against our competitors, if left unchecked," AEPC Chairman Ashok Rajani stated. "I also request the government to fast track the roll out of the special package with full reimbursements of state levies (ROSL) claims and implementation of the optional PF provision provided in the package," he stated.

He pointed out that cotton prices have increased by 24.7% on an average, across all categories in the last year. In fact some categories have seen hike of up to 35%, he said.