FIEO President, Mr Sharad Kumar Saraf, reacted to the highest ever double-digit decline in monthly exports during March 2020 by 34.57 per cent at USD 21.41 billion. He said that COVID-19 has not only pulled down the world sentiment to its lowest but has also affected the global supply chain and brought economies in recessionary condition. Global economies are facing the worst crisis in terms of a slowdown as compared to that of 1930. The annual merchandise exports figure of USD 314.31 with nominal negative growth of 4.78% is on the expected lines. As exporters were not able to export during the 2nd half of March, cancellations and delay of shipments and orders.
He said that at least during the 1st quarter of 2020-21 the sector will see a similar growth trend. However, from the 2nd quarter of the fiscal, exports may start showing nominal growth. Further, the oil-exporting countries are facing the brunt as oil and other commodity prices have drastically declined during recent days.
Global Figures by FIEO President
Except for iron-ore, 29/30 major product groups were in negative territory during March 2020. With crude prices moving southwards and supply disruptions extending to Europe and the US. Due to COVID-19, more comfort expected in imports during the next few months. Mr. Saraf expressed his serious concerns over a sharp decline in employment-intensive sectors of exports. With the cancellation of over 50% of orders, dismal forecast, major job losses and rising NPAs amongst exporting units, the Federation urges the Government to immediately announce a relief package for exports as any further delay would be tragic. He said that the huge support given by various economies to exports will put Indian exports in further difficulties.
COVID Interest-free Working Capital Term Loan to Exporters to cover the cost of wages, rent and utilities. Additionally, EPF and ESIC waiver for 3 months from March to May 2020; and extension of pre and post-shipment credit by 90-180 days on their maturity is much-needed step to help the exporting community during such difficult and testing times. He said rollover of forwarding cover without interest and penalty and automatic enhancement of limit by 25% to address liquidity challenges will also be considered. Saraf asserted that the extension of Interest Equalisation Benefits should be looked into for immediate consideration.