Fabric exporters see red as Re strengthens

SURAT: Stronger rupee has weakened the exports of fabrics, sarees and dress materials from the textile hub of Surat. Annual exports from the region are likely to fall by almost 50% to Rs 400 crore. Exporters in the biggest manmade fabric industry are a worried lot. Most of the small and medium exporters have already stopped exporting their goods to foreign shores due to eroding profit margins.

Fabrics and dress materials worth Rs 800 crore are exported to the UAE, the UK, Indonesia, England, the US, France, South Africa, Malaysia, Spain and Australia annually. However, this year, the export is likely to be between Rs 350 crore and Rs 400 crore due to the current market scenario.

“Profit margins are shrinking and the going is getting tough for exporters,” said chairman of the Southern Gujarat Textile Exporters’ Association, Pramod Chaudhary. He said that most of the small exporters in the city had stopped their exports and were waiting for the Centre to bail them out.

Around 90% of the export was done in dollars and the rising rupee had affected exporters’ profitability by over 15%, said Mr Chaudhary. According to him, exporters from across the country have asked the Centre to provide some relief in terms of enhancing the duty entitlement pass book and duty drawback rates.