MADURAI: Depreciation of rupee that usually results in windfall gains for Indian exporters has not brought much cheers to the exporters from Madurai this time around.
While some of the exporters did see a rise in their profits, they pointed out that it was too meagre. Many others note that fall in rupee value means little to them as their importers in Europe and other countries have started demanding a discount. The exporters point out that the export market was also shrinking due to dollar appreciation and economic uncertainty in many countries.
N Jegatheesan, president of Tamil Nadu Chamber of Commerce and Industry, said that most exporters from Madurai have a one-to-one relationship with their overseas buyers. "In such a relationship if a buyer seeks a discount in view of dollar appreciation corresponding to a fall in rupee value, exporters are in a position to oblige. Buyers have also started demanding cash in rupee equivalent. We can argue with buyers and be shrewd. But that might affect long-term trade especially if we are dependent on them,'' he said.
As far as Madurai jasmine is concerned, it has a market in a few pockets of the globe, but the profit due to fall in rupee value is meagre. "We export about 150 to 300 kg daily from Madurai. Due to rupee depreciation, we get just Rs 15 additional per kg which is not big money,'' Jegatheesan said.
Players in the sea food, another major exporting sector, are also not very enthused over the situation. "The movement of sea food is generally slow as the season starts only by October last. Even otherwise, there is a general reluctance among buyers to place the orders due dollar appreciation," said V Ramakrishnan, group general manager of Diamond Sea Foods, Tuticorin.
However, the importers in the region are feeling the heat. M Marimuthu, proprietor of a plastic unit in Kappalur Industrial Estate, said that the material cost has increased over the last two months since rupee started falling. "One kg of plastic used to cost Rs 90 two months back. Now it costs Rs 107 per kg,'' Marimuthu said. Though Marimuthu sources his raw materials locally, the plastic industry is heavily dependent on imports.
"We are in a severe constraint due to rupee value depreciation. Feedback from traders is also not encouraging. They say sales is very poor. The capacity of our unit is 60 tonne per month, but we are now manufacturing only 8 tonnes of products,'' Marimuthu concluded.
Source:-timesofindia.indiatimes.com
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