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December exports move toward positive territory as New Year brings ray of hope and optimism with effective vaccines expected to revive life and global economy: Sharad Kumar Saraf, President, FIEO

Reacting to December 2020 export figures, FIEO President, Mr Sharad Kumar Saraf said that the monthly exports have moved towards positive territory as major export products show signs of further revival as expected. Marginal decline of just 0.8 percent with USD 26.89 billion of exports showing signs of revival as order booking position have continuously improved besides more new orders in the offing added Mr Sharad Kumar Saraf. He reiterated that the New Year 2021 has brought a ray of hope and optimism for all from the worst of Covid-19 and effective vaccines are expected to bring both life and economy back on growth trajectory with a v-shaped recovery in world trade. Arrival of vaccines have also helped in boosting the business sentiments for the sector as a whole, which can be further seen from the positive figures of the upcoming months said Mr Saraf.

FIEO President added that December exports also signals that our traditional and labour-intensive sectors of exports have passed the most challenging and testing times as both Christmas and New Year Season sales have shown positive trends with further improvement in coming months. Going ahead by this trend, we expect our inventories to be liquidated, adding further to the overall demand, observed Mr Saraf.

FIEO Chief said that the exports of other cereals along with oil meals, iron-ore, cereal preparations and miscellaneous processed items, jute mfg. including floor covering, handicrafts excl. hand-made carpet, carpet, ceramic products and glassware, drugs and pharmaceuticals, spices, electronic goods, fruits and vegetables, organic and inorganic chemicals, cotton yarn/fabrics/made-ups, handloom products etc., rice, meat, dairy and poultry products, gems and jewellery, mica, coal and other ores, minerals including process, tea and engineering goods showed either a very high or impressive growth or were in positive territory showing signs of further revival.

Mr Saraf also said that reduction in exports of major products including petroleum products, oil seeds, leather and leather manufactures, coffee, RMG of all textiles, man-made yarn/fabrics/made-ups etc., marine products, cashew, plastic and linoleum and tobacco and which are major constituents in India’s export basket and related to labour-intensive sector of exports have also been of key concern during the month. However, increase in imports during December 2020 by 7.6 percent to USD 42.60 billion compared to the same period during the previous fiscal led to a trade deficit of USD 15.71 billion with a substantial increase of 25.88 percent during the month.

FIEO Chief also said that the operationalization of the new RoDTEP effective from January 1, 2021 will remove uncertainty from the minds of the trade and industry and being WTO compatible, the same would provide complete rebating of Indian exports by refunding the taxes including embedded taxes, not rebated through any other mechanism. However notification of the rates is the need of the hour. Mr Sharad Kumar Saraf urged the government to address some of the key issues including adequate availability of containers, softening of freight charges, release of the required MEIS benefits and clarity on SEIS benefits, resolving risky exporters issues, introduction of NIRVIK Scheme, long pending demand for the creation of an Export Development Fund for marketing of Brand India products and various other infrastructure bottlenecks with regard to customs and port clearances, which will further help in giving boost to our exports not only in FY’ 2020-21 but also for the upcoming new fiscal.

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